What’s News in Markets: Netflix Raw, IBM Bounce, Tesla’s Speed Bumps
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What is the main topic discussed in this episode?
Hey, your money briefing listeners. I'm Francesca Fontana for The Wall Street Journal. Every week, I write a column for The Journal called The Score. It's a look at the biggest stock moves of the week and the news that drove them. And now, every Saturday, we're bringing you what's news in markets. Let's get to it.
What market factors helped the Dow and S&P 500 hit new records this week?
The stock market had a rough start to the new year, but now it's really finding its footing. The Dow and the S&P 500 have been hitting new records this week, and there's a few things going on. Investors are encouraged by the start of earnings season, which picked up steam this week. There are signs that the economy remains strong. And, of course, there's the Magnificent Seven. That's what investors are calling the tech giants that have been leading the market higher. Google parent Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. I get why they've gone with the Magnificent Seven. There's no good acronym there. In any case, we'll see if the market can keep it up.
Why did Netflix sign a 10-year deal with WWE and what does it mean for live programming?
Now, one of the biggest stars in this week's earnings reports was Netflix. And it delivered a smackdown. That's right. Netflix struck a new 10-year deal with WWE, getting rights to WWE Raw and other shows. And this is a big step for Netflix as it ramps up its investment in live programming. Netflix is basically synonymous with binge-watching TV shows and streaming movies, but now the company is trying to add more live, regularly scheduled programs. Sound familiar?
How did Netflix's subscriber growth beat expectations and impact its stock price?
If you're old enough to remember cable TV, it should. Along with the WWE deal, Netflix also added a ton of new subscribers in the latest quarter, about 13 million, and that's 50% more than Wall Street expected. Investors were pretty happy about this, and Netflix shares jumped 11% Wednesday, leading the S&P higher. And let's not forget WWE's parent company, TKO Group. Its stock shot up nearly 20% Tuesday, the day the deal was announced, and it held on to most of those gains the rest of the week.
Why did IBM's Watson X drive a stock surge and mark a turnaround for Big Blue?
And that's despite a new lawsuit that landed a couple days later accusing TKO executive chairman Vince McMahon of sex trafficking. A spokesman for McMahon denied the allegations.
Big Blue is back. IBM was another earnings winner this week. The legacy tech giant saw a jump in its profit thanks to good old AI. Specifically, strong demand for the company's artificial intelligence platform, Watson X. IBM shares jumped more than 9% on Thursday, closing at $190.43. That's the first time IBM's stock has closed above 190 since 2013, and it pretty much held onto those gains on Friday. Another tech giant posted its latest results this week, Intel.
What caused Intel's weak outlook and how did it affect other chip stocks?
But that report wasn't nearly so rosy. The company gave a muted outlook for sales in its current quarter, and it's hoping the AI boom will give the chip market an added boost. But that boost has yet to hit Intel, and investors are reacting accordingly. Intel shares dropped more than 10% during Friday's trading session, dragging other chip stocks down with it. Now let's talk about Tesla. Tesla sees speed bumps ahead in 2024.
Why is Tesla expecting 'speed bumps' in 2024 and how did investors react to Musk's control comments?
On Wednesday, Elon Musk's electric car company said that its growth would slow this year and that its profit margin took a hit in the fourth quarter. Unlike a few years ago, Tesla isn't doing so hot. Demand's slowing down, margins are shrinking, and competition's intensifying. Also, during Tesla's earnings call on Wednesday, Musk reiterated his desire for greater control over the company, saying he wants enough to have strong influence and to deter activist shareholders. And I say reiterated because he made some waves last week on this topic too. Last Monday, he wrote on X, formerly Twitter, which he owns, that unless he controls about 25% of Tesla, he'd prefer to build AI and robotics products elsewhere, basically an ultimatum.
Now, how did investors react to all this? Well, Tesla's stock lost 12% on Thursday, its worst daily drop in over a year. Safe to say that Tesla has seen better days. And now you know what's news in markets this week. You can read about more stocks that moved on the week's news in Wall Street Journal's Exchange section.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:03–0:25
2
What market factors helped the Dow and S&P 500 hit new records this week?
0:25–1:05
3
Why did Netflix sign a 10-year deal with WWE and what does it mean for live programming?
1:05–1:33
4
How did Netflix's subscriber growth beat expectations and impact its stock price?
1:33–2:03
5
Why did IBM's Watson X drive a stock surge and mark a turnaround for Big Blue?
2:03–2:52
6
What caused Intel's weak outlook and how did it affect other chip stocks?
2:52–3:18
7
Why is Tesla expecting 'speed bumps' in 2024 and how did investors react to Musk's control comments?
3:18–4:33
Speakers
1 identifiedMore from WSJ Your Money Briefing
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