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Stock Market News: S&P 500 and Nasdaq Close at Highest Levels Since April 2022
U.S. Equities Markets Strong Before Thursday's Session
U.S. equities markets were on a roll heading into Thursday's session. The S&P 500 and the Nasdaq both closed Wednesday at their highest levels since April 2022. The Dow also finished the day higher, as the consumer price index for June showed cooler-than-expected inflation data for June, indicating that the economy could be heading for a soft landing, after all. Wholesale inflation data, known as the producer price index, is slated to hit at 8:30 a.m. ET. Thursday also effectively kicks off earnings season, too. Delta Air Lines and PepsiCo reported before the bell.
Bob Iger's Contract as Disney CEO Extended Through 2026
When Bob Iger returned to Disney as CEO in November to replace his hand-picked successor in the role, both he and the company made a big point about how finding his next replacement would be a big part of his job. About seven months later, Iger and Disney are still talking a big game about succession – although now Iger has an extra two years (at least) to figure out the next head of the Mouse House. The company said Wednesday that it had extended Iger's contract through the end of 2026, two years longer than initially planned, as the newly reorganized company looks to juice its moribund stock while getting its costly streaming services to profitability.
PepsiCo Outperforms Expectations in Q2
PepsiCo raised its outlook for the year as its results for the second quarter easily beat Wall Street's expectations. The snack-and-soda giant said its profit and revenue both surged from the same period last year. Still, higher prices for the company's products hurt demand and resulted in volume declines. Volume, which excludes changes in prices and foreign exchange, dropped 3% for Pepsi's food divisions and 1% for its beverages. Frito Lay North America volumes did grow, however, as consumers snapped up Doritos and Ruffles.
Delta Air Lines Posts Record Quarterly Revenue
Delta Air Lines posted record quarterly revenue and per-share earnings Thursday, while raising its full-year earnings guidance. Delta is the first U.S. airline to post earnings for the second quarter, and its report should set a strong tone as the industry continues to benefit from sky-high travel demand. Lower fuel prices and demand for premium seats and international travel boosted Delta's results. The third quarter is looking strong, as well. The company's outlook for the current period surpassed Wall Street's expectations. "I think the trends that we've seen this year are going to continue," CEO Ed Bastian told CNBC.
Actors Union and Hollywood Studios Fail to Reach Agreement
Negotiations between the actors union and Hollywood studios fell apart early Thursday morning, setting the stage for yet another showbiz strike. The Screen Actors Guild-American Federation of Television and Radio Artists' national board will decide Thursday morning whether to hit the picket lines. If they do, actors will be striking alongside members of the Writers Guild of America, further slowing the production machine in Tinseltown. "SAG-AFTRA negotiated in good faith and was eager to reach a deal that sufficiently addressed performer needs, but the AMPTP's responses to the union's most important proposals have been insulting and disrespectful of our massive contributions to this industry," said Fran Drescher, the actors union president and star of "The Nanny."
Implications for New Businesses in the Stock Market Boom
The recent surge in the S&P 500 and Nasdaq, coupled with positive corporate news from companies like Disney, PepsiCo, and Delta Air Lines, reflects a robust and optimistic stock market. For new businesses looking to enter the market, this upward trend brings both opportunities and challenges.
The Potential for Increased Funding and Investment
With the stock market reaching its highest levels since April 2022, investors are likely to have a positive outlook on new business ventures. This presents an opportunity for startups and emerging companies to attract funding and investment. The strong market performance indicates investor confidence and may result in greater willingness to take risks on innovative ideas and early-stage companies. New businesses can leverage this positive sentiment to secure the necessary capital for growth and expansion.
Competition and Market Volatility
While the booming stock market can be advantageous, it is important for new businesses to be mindful of increased competition. As more companies seek to enter the market and capitalize on the favorable conditions, it becomes crucial to differentiate and bring unique value propositions to the table. Moreover, as the market experiences highs, there is always the risk of increased volatility. New businesses should carefully assess the market conditions and develop strategies to navigate potential fluctuations in the future.
The failure of negotiations between the actors union and Hollywood studios, leading to a potential strike, serves as a reminder that industry-specific challenges can impact businesses. For startups in the entertainment and media sector, potential disruptions in production can have significant consequences. New businesses need to be aware of industry dynamics, such as labor disputes or regulatory changes, and adapt their strategies accordingly.
In summary, the current stock market boom presents new businesses with opportunities for funding and investment. However, increased competition and market volatility should also be carefully considered. Industry-specific challenges further highlight the need for adaptability and resilience. By navigating these dynamics with a strategic approach and a clear understanding of the market environment, new businesses can position themselves for success in this thriving economy.
Article First Published at: https://www.cnbc.com/2023/07/13/5-things-to-know-before-the-stock-market-opens-thursday-july-13.html