What’s News in Markets: Walgreens Talks, Alphabet’s Quantum Leap, Cruise Control
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Hey, listeners, it's Saturday, December 14th. 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. All right, guys, next week is the big week. The Fed will have another interest rate decision for us, the last one of the year. And it seems like we've all settled on expecting a quarter percentage point cut, especially after investors got to digest Wednesday's Consumer Price Index data, which was in line with consensus expectations and bolstered confidence that we have a cut coming our way. Other stories we saw playing out in stocks this week include developments in the so-called U.S.-China chip war, with Beijing announcing an antitrust probe of Nvidia, the AI poster child stock.
And speaking of big tech, we saw some big moves from Oracle and Alphabet, but we'll come back to those in a bit. Now let's look at the indexes. The S&P 500 and Dow Jones Industrial Average ended up each posting weekly declines. Meanwhile, the Nasdaq Composite secured its fourth consecutive week of gains. Looking at individual movers from the week, let's talk about Walgreens. The stock's been pretty under the weather due to mounting pressure on its pharmacy and retail businesses. But things turned around on Tuesday after The Wall Street Journal reported that Walgreens is in talks to sell itself to private equity firm Sycamore Partners. If these talks don't fall apart, a deal could be completed early next year, according to our reporting.
Before the Journal reported on this development between Walgreens and Sycamore, Walgreens stock was down nearly 70% so far this year. And remember, for those of you playing along at home, the S&P 500 is up more than 25% year-to-date. But on Tuesday, Walgreens shares jumped a whopping 18%, marking the highest one-day jump in the company's history. And the stock ended the week up more than 20%.
Now, as promised, let's circle back to big tech. On Tuesday, two major stocks made two major moves in opposite directions. And those two stocks were Oracle and Alphabet. Oracle, the software company, was one of the day's biggest losers, thanks to its slightly disappointing quarterly results from late Monday. The company said revenue rose 8.6 percent to $14.06 billion, which is just slightly below the $14.12 billion that analysts expected, according to FactSet.
What market context and macro events shaped stock moves this week?
Though it's important to remember the larger trend we've been seeing from Oracle. Before Monday's update, optimism about AI had helped send the stock up more than 80 percent this year. So we'll have to wait and see whether this is just a slip or a larger slide downward. In any case, Oracle fell more than 6% on Tuesday and notched a weekly decline of more than 9%. On the flip side, a bright spot among tech stocks on Tuesday was Alphabet, the parent company of Google, which on Monday unveiled a state-of-the-art quantum chip named Willow. And this was a big win for Google in its effort to compete in quantum computing. Not a big tech guy myself, but it even just sounds cool, right? Quantum computing, quantum mechanics, the show Quantum Leap, all very cool.
So on that good news, Alphabet shares gained more than 5% Tuesday and ended the week with a gain of more than 8%. Speaking of tech, AI, quantum computing, why not add robots to the mix? Well, robo-taxis, because we are looking at General Motors, which announced Tuesday that it's scrapping its cruise robo-taxi program after nearly a decade and some $10 billion of development. The company said the restructuring was due to challenges like rising competition and the time and costs it needed to scale the business.
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