Key Takeaways
- Netflix Underwhelms With Earnings
- Layoff Announcements Continue
- Tesla Earnings After The Close
It was a very quiet Tuesday with stocks mostly unchanged. The S&P 500 was up just 0.1% while the Nasdaq Composite was down by a similar amount. Volume was relatively light as investors awaited some of the better known household names to report first quarter earnings.
Immediately after the close Tuesday, Netflix
NFLX
delivered a disappointing report. While revenues increased 3.7%, profits were down 18%. However, after an initial knee-jerk reaction that sent shares sharply lower, the stock rebounded, recouping much of the losses. News that the company would begin further cracking down on password sharing along with an increase in ad-supported users reassured investors. The on-demand streamer also announced they will ship their last DVD later this year, marking the end of an era that feels reminiscent of the end of the Sony Walkman. In premarket, Netflix is indicated about 1% lower.
Elsewhere, more layoffs were announced and implemented at several companies. After previously having announced plans for layoffs, Amazon
AMZN
began letting people go Tuesday, in their advertising department. Facebook parent, Meta Platforms
FB
also said more jobs cuts would be announced today. The jobs being cut will come from Facebook, WhatsApp, Instagram and Reality Labs. Also, Disney made public their plans to let go 15% of workers in the entertainment division.
After the close on Tuesday, Fox News and Dominion Voting Systems reached a settlement just before their trial was set to begin. The $787.5 million settlement is notable not just for its size, but also for the potential impact it will have across the industry.
An overnight report out of the UK showed inflation remains strong. That news sent UK bonds lower, taking US bonds with them. Yields on the benchmark 10 year note are now up over 4.25% after having fallen as low as 3.65% earlier this month. When the Fed meets in just a couple weeks, expectations are overwhelmingly suggesting a quarter point rate hike.
Finally, after the close tonight, Tesla
TSLA
will announce their earnings. Yesterday, Elon Musk announced the EV maker was cutting car prices for the second time this month. Currently, the market is expecting shares of Tesla to move in a range of +/- $13 by Friday. As always, I would stick with your investing plan and objectives.
tastytrade, Inc. commentary for educational purposes only. This content is not, nor is intended to be, trading or investment advice or a recommendation that any investment product or strategy is suitable for any person.
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