Traders on the floor of the NYSE, October 20, 2022.
Here are the most important information investors need to start their trading day:
1. Weak point?
The good news: Stocks are on course for their best week since the start of last month. The bad news: US markets are on a two-day losing streak and things weren’t looking so good before the bell on Friday either. After a promising start to the week, as equities were fueled by relatively strong earnings reports from major banks and others, bond yields soared, sending stocks tumbling. On Thursday, the 10-year Treasury yield hit 4.239% for the first time in 14 years. 2-year and 30-year yields also reached levels not seen in over a decade. Read live market updates here.
Read more: An often-overlooked economic metric signals serious trouble ahead
2. Broken again
Co-founder and CEO of Snap Inc. Evan Spiegel attends the Viva Technology conference dedicated to innovation and startups, at the Porte de Versailles exhibition center in Paris, France on June 17, 2022.
Benoit Tessier | Reuters
It didn’t matter that Instantaneous released adjusted earnings per share as Wall Street expected a loss. Or that its revenue has increased or its number of users has increased. All of that just wasn’t good enough, and it doesn’t look like it’s going to improve as the ad market tightens. Snap shares, already down 77% at Thursday’s close, fell 25% in after-hours trading. The company’s 6% year-over-year revenue gain was the first time quarterly sales growth fell into single digits since the social media company went public in 2017. users was offset by lower revenue per user. “We are seeing our advertising partners across many industries shrink their marketing budgets, particularly in the face of operating environment headwinds, cost pressures from inflation and rising capital costs,” said Snap to shareholders.
3. More twists in the Twitter saga
In this photo illustration an image of Elon Musk is displayed on a computer screen and the twitter logo on a mobile phone in Ankara, Turkiye on October 06, 2022.
Muhammed Selim Korkutata | Anadolu Agency | Getty Images
The Washington Post reported Thursday night that Elon Musk plans to eliminate 75% of Twitterits 7,500 employees if he takes over the company. A former executive said the cuts would be so drastic they could expose users to security threats and images of children in sexual abuse situations. But, the Post added, Twitter’s current regime is itself planning for dramatic layoffs — about a quarter of the company’s workforce — and closing Musk’s $44 billion deal to buy the social network from them. would avoid making painful decisions. Twitter’s top lawyer, in response to the Post article, told employees in an email that the company’s plan was put on hold after the merger agreement was signed. Musk has until October 28 to close the deal. Somewhere else, Bloomberg reported that the Biden administration was considering national security reviews for Musk’s Starlink satellite internet service and his Twitter deal.
Read more: Facebook shuttle drivers lose their jobs
4. Ukraine continues
Ukrainian President Volodymyr Zelenskyy visits the Memorial Wall of Fallen Defenders of Ukraine, amid Russia’s attack on Ukraine, during the celebration of Defender of Ukraine Day in Kyiv, Ukraine , October 14, 2022.
Ukrainian Presidential Press Service | Reuters
Ukrainian forces continued to retake territory in the Kherson region, as Russian forces withdrew and evacuated the area. The Ukrainian government has accused the Russians of forcibly deporting Ukrainians, but the Kremlin has denied it. Volodomyr Zelenskyy, President of Ukraine, also warned that Russia could attack a hydroelectric dam in Kherson. His comments come as Ukraine attempts to repair its electricity infrastructure following waves of Russian missile and drone attacks on city centers and other major centers. Read Live War Updates here.
5. Who’s next?
Britain’s Prime Minister Liz Truss announces her resignation, outside Number 10 Downing Street, London, Britain, October 20, 2022.
Henry Nicholls | Reuters
After just a month and a half on the job, Liz Truss announced on Thursday that she will step down as Prime Minister of the United Kingdom. Although his tenure was brief, it was substantial. His government’s heavy economic tax-cutting plans shook UK markets deeply and severely weakened the pound as the country was already struggling with a rising cost of living. So who’s next? Rishi Sunak, a former finance minister who was a Truss runner-up, is seen as the favorite to succeed him. Penny Mordaunt, who finished a surprising third in the Tory leadership race, is also on board. Defense Secretary Ben Wallace is highly regarded, but it is unclear whether he would run. And there is always Boris Johnson. Seriously. CNBC’s Karen Gilchrist breaks down the state of play here.
– CNBC’s Alex Harring, Jonathan Vanian, Natasha Turak and Karen Gilchrist contributed to this report.
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