Stocks rocky week, stagflation coming? Musk’s legal woes
Stocks open higher as rocky week winds down
U.S. stocks open higher despite a wild week of swings. Healthcare and energy stocks led early gains for the Dow Jones Industrial Average and S&P 500.
For the Nasdaq Composite, Facebook and trucker C.H. Robinson drove gains, while Dollar Tree and Ross Stores lagged.
Footlocker shares rose after confirming it will be able to meet the “upper end of 2022 sales and earnings” per the company’s earnings release. Nike also rose, as it Footlocker is a large distributor of its products.
“Following our solid results from the first quarter, our strong inventory position going into the remainder of the year, and our strengthening vendor relationships, based on our current visibility, we now expect to achieve the upper end of our revenue and earnings guidance for the full year. Our balance sheet and real estate flexibility remain strategic assets for us as we continue to navigate this dynamic industry and serve the sport and sneaker community” said Andrew Page, Executive Vice President and Chief Financial Officer.
S&P 500 Bear Market Watch
The S&P 500 is already down 18.7% from recent high of 4,796.56 and would hit bear market territory at 3,837.
Futures at a glance
Musk responds to ex-SpaceX flight attendant’s sexual assault claim
Musk, in a Thursday tweet following the story, claimed the story should be “viewed through a political lens.”
The attendant worked on a contract basis in the cabin crew for SpaceX’s corporate jet fleet. She accused Musk of exposing his erect penis to her, rubbing her leg without consent, and offering to buy her a horse in exchange for an erotic massage, according to Business Insider.
A declaration signed by the attendant’s friend detailed the incident, which reportedly took place in 2016. Email correspondence and other records, which the friend provided Business Insider, reportedly corroborate the claims. The attendant reportedly told her friend that SpaceX encouraged her to get licensed as a masseuse, so she could give Musk massages. She said Musk propositioned her during one such massage.
Musk denied the sexual claims in a brief statement to Business Insider, insisting that there is “a lot more to this story.”
Crypto prices mixed as Bitcoin, Dogecoin lower, Ethereum higher
Cryptocurrency trading was mixed early Friday morning, with Bitcoin and Dogecoin down, but Ethereum higher.
Bitcoin broke the $30,000 plateau and was trading at approximately $30,160 (-0.72%), down $218 at around 4:50 a.m.
For the week, Bitcoin was higher by 4.24%.
For the month, however, it was down nearly 27%.
Ethereum was trading at $2,025 (+0.14%), up $2.89 per coin.
For the week, Ethereum was higher by 2.41%. For the month, the crypto was down nearly 35%.
Dogecoin was trading at 0.086 cents (-0.84%) per coin early Friday, down $0.0007 cents.
For the week, Dogecoin was up by 3.63%.
For the month, however, Dogecoin was down almost 40%.
New record high for gallon of gasoline in US reached
The national average for a gallon of gasoline hit another record high early Friday morning, and is expected to continue rising as the energy supply crunch in the U.S. rages on.
The latest average price for a gallon of gasoline in the U.S. rose to a record $4.593 Friday, the fourth-straight day of breaking new records.
On Thursday, the average price for a gallon of gasoline was $4.589. One day earlier, the average price was $4.567, topping Tuesday’s record of $4.523.
On Monday, the gasoline average stood at $4.47.
One week ago, the average price of a gallon of gas was $4.432.
US stocks higher in early trading; first-quarter earning reports near end
Cisco Systems Inc.
U.S. stocks were trending higher early Friday morning after losses on Thursday.
On Wall Street, the S&P 500 fell to 3,900.79. The Dow Jones Industrial Average fell 0.8% to 31,253.13. The Nasdaq slipped 0.3% to 11,388.50.
Investors are watching the Federal Reserve for hints of further interest rate hikes to cool inflation that is running at a four-decade high. Fed Chair Jerome Powell said this week the U.S. central bank might take more aggressive action if price pressures fail to ease.
First-quarter earnings season is winding down, with agricultural machinery maker Deere and Company and sportswear and footwear retailer Foot Locker posting ahead of the opening bell. Also reporting will be management consulting firm Booz Hamilton.
Traders also are uneasy about China’s economy after official data showed factory and consumer activity in April were weaker than forecast after Shanghai and other industrial centers shut down to fight coronavirus outbreaks.
Cisco Systems slumped 13.7% after the seller of routers and switches cut its profit forecast amid supply chain constraints. Synopsis jumped 10.3% after the software company raised its financial forecasts for the year.
Retailers and other companies that rely on direct consumer spending mostly rose. Amazon added 0.2% and Expedia climbed 5.3%.
Meanwhile, Asian stock markets rose Friday.
Market benchmarks in Shanghai, Tokyo, Hong Kong and Sydney advanced.
NBA owners probed over China ties
were scrutinized Thursday as a new report detailed just how much money some have tied up in Chinese investments.
NBA owners have around $10 billion in Chinese ventures despite the government’s authoritarian crackdown on free speech and the imprisonment of Uyghur Muslims in the country, ESPN reported, citing a study conducted by a New York-based firm called Strategy Risks.
The study highlighted the investments of Charlotte Hornets owner Michael Jordan, Miami Heat owner Mickey Arison, Brooklyn Nets owner Joe Tsai, Sacramento Kings co-owner Paul Jacobs, Memphis Grizzlies owner Robert Pera, Houston Rockets owner Tilman Fertitta and Philadelphia 76ers’ principal owner Joshua Harris.
While some owners endorsed the NBA’s initiative to highlight social justice efforts in the United States, all have remained quiet on China’s human rights violations. China’s crackdown on Hong Kong protesters in 2019 over a new national security law came to the forefront of the league.
Then-Rockets general manager Daryl Morey tweeted his support for Hong Kong protesters as the Nets were about to face off against the Los Angeles Lakers in Shanghai. Morey tweeted “Fight For Freedom. Stand With Hong Kong,” before deleting it after backlash.
The tweet had a ripple effect throughout the NBA. China would pull NBA games off its state-owned TV only to return ahead of this season’s NBA playoffs, ESPN reported.
Tsai, who was born in Taiwan, is a naturalized Canadian citizen who holds a Hong Kong passport. He is a co-founder and executive chairman of Alibaba and, in addition to the Nets, owns the WNBA’s New York Liberty and the San Diego Seals of the National Lacrosse League. He reportedly had a rift with Morey over the Hong Kong tweet but denied accusations of uninviting Morey to the Barclays Center for a game between the Rockets and Nets.
Oil falls on uncertainty over fuel demand recovery
Oil prices fell on Friday as investors worried that weakening global economic growth and tighter central bank monetary policy could curb a recovery in fuel demand.
Brent futures for July fell 59 cents, or 0.53%, to $111.45 a barrel by 0648 GMT, while U.S. West Texas Intermediate (WTI) crude for June fell 56 cents, or 0.5%, to $111.65 on its last day as the front-month.
The more actively traded WTI contract for July was down 0.8% at $109.01 a barrel.The International Monetary Fund (IMF) urged Asian economies to be mindful of spillover risks from monetary tightening.
Asian economies faced a choice between supporting growth with more stimulus and withdrawing it to stabilize debt and inflation, IMF Deputy Managing Director Kenji Okamura said.
While Bank of Japan policy runs counter to a global shift towards monetary tightening, central banks in the United States, Britain and Australia raised interest rates recently.
Crude gains have been limited this week, with Brent and WTI mostly trading in a range due to the uncertain path of demand. Investors, worried about rising inflation and more aggressive action from central banks, have been reducing exposure to riskier assets.