What’s News in Markets: Musk’s Pay, AI Deals, Broadcom’s Split
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Hey, listeners, it's Saturday, June 15th. I'm Francesca Fontana for The Wall Street Journal, and this is What's News in Markets, our look at the biggest stock moves of the week and the news that drove them. Let's get to it. one interest rate cut this year. That's the projection that traders heard from the Federal Reserve on Wednesday, despite a mild inflation report. And for those of you keeping score at home, that's down from an earlier projection of three rate cuts. Now, there are ways that the Fed could start guiding down rate expectations before it pulls the trigger on actual cuts. If you want to hear more about that after this, take a listen to Thursday's PM edition of What's News. I got to chat with my colleague Justin Layhart all about it.
Great stuff. Anyway, bottom line, we're still seeing caution from the Fed right now. And that caution is creeping into markets. After four sessions of the S&P 500 and the tech-heavy Nasdaq closing at record highs, the major indexes ended the week with a mixed day on Friday. Now, as far as individual stocks go, we saw a lot of buzz around AI. Then again, when are we not seeing buzz around AI these days, right? Let's start with Apple, which on Monday unveiled its quote-unquote AI, except in this case it's not artificial intelligence, it's Apple intelligence. Very clever. Now, Apple Intelligence is the system-wide software update for Apple devices that would offer users a personalized version of generative AI.
Investors seem pretty stoked about this, and Apple shares gained about 7% on Tuesday, reaching their first record high of the year. Plus, the stock ended the week in the green. But wait, there's more. During the week, we also had Oracle, no, I'm not talking Greek mythology or the Oracle of Omaha Warren Buffett, Oracle the software company, which announced some new AI deals, specifically with Microsoft, Alphabet, and, here it is again, OpenAI. Oracle shares jumped 13% on Wednesday and held on to most of those gains the rest of the week. Then we had Adobe, as in Adobe Acrobat or Adobe Photoshop. This software company posted better than expected quarterly results, and its CEO said the company's approach to AI is helping attract new customers.
Good for Adobe, which saw its shares climb more than 14% higher Friday. All right, remember NVIDIA, the AI chip maker whose stock has been going nuts lately? Well, fellow semiconductor firm Broadcom followed in its footsteps this week, announcing a stock split, a 10-for-1 split. It's an effort to make Broadcom shares more affordable for investors and employees, and it'll happen next month. Nvidia also did the same thing earlier this month. It makes sense, as we've seen Broadcom stock like Nvidia's and other chip stocks affected by the AI arms race has grown more expensive due to all this surging demand. So how did Broadcom's stock do after the news? The shares ended up about 12% Thursday and added roughly 3% on Friday.
Last but certainly not least, let's talk about Elon Musk. He's been in the news quite a bit, so I should be more precise. Let's talk about his contentious pay package at Tesla.
How did the Federal Reserve’s revised rate-cut projections affect market sentiment?
This week, we were watching to see whether Musk would get enough shareholder votes on Thursday to clinch approval for his multibillion-dollar compensation deal, one that was thrown out by a judge earlier this year. Before the actual count came in, we did have some suggestion as to what the outcome might be, namely Musk's post on X late Wednesday saying that the preliminary results showed that shareholders were backing the proposal by a wide margin.
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Chapters
2 chaptersSpeakers
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