Here are the most important news items investors need to start their trading day:
1. Fall down
Stocks fell sharply on Tuesday on concerns that the Federal Reserve’s monetary easing would be slower than expected.Christopher Waller Fed Director In his speech, he said the central bank would “systematically and carefully” consider cutting interest rates this year, adding: “I see no reason to act as quickly or cut rates as much as we have in the past.” In the first trading session of the shortened week, the Dow Jones Industrial Average fell 0.62%, the S&P 500 fell 0.37% and the Nasdaq Composite Index fell 0.19%. Meanwhile, the benchmark 10-year government bond yield rose to 4.064%. Follow live market updates.
2. Grounding
federal judge blocks jet blue airlines proposed acquisition for $3.8 billion spirit airlinesHe cited a decrease in competition due to the planned merger. The merger would have created the fifth-largest airline in the United States, but the Justice Department filed a lawsuit last year claiming it would raise airfares. “Spirit’s discontinuation will harm cost-conscious travelers who rely on Spirit’s low fares,” U.S. District Judge William Young said in his decision blocking the deal. . The judge’s ruling raises new questions about Alaska Airlines’ plan to buy Hawaiian Airlines, although the two companies have more similar business models than ultra-low-cost Spirit or full-service JetBlue. On Tuesday, when the verdict was handed down, Spirit’s stock price nearly halved. The airline said in a statement that it disagreed with the ruling and was considering its options.
3. Burger purchase
burger king parent Restaurant Brands International will acquire Carroll’s Restaurant Group, the chain’s largest franchisee, for approximately $1 billion in cash. This marks a shift in strategy for Burger King, which currently only has 175 corporate-owned stores. Carroll’s operates more than 1,000 Burger King restaurants and 60 Popeyes restaurants. The restaurant brand is trying to revive its burger banner, which has seen sluggish sales. Josh Kobza, CEO of Restaurant Brands, said of the acquisition, “This will allow us to accelerate our renovations and think through how we can refranchise this restaurant network into smaller packages. “I can really concentrate on that.”
4. “New growth model”
China did not reach An economist said fourth-quarter GDP estimates will be released on Wednesday as the world’s biggest economies embrace a “new growth model.” According to China’s National Bureau of Statistics, GDP growth in the last three months of this year was 5.2%, lower than the 5.3% expected in a Reuters poll. Full-year GDP grew by 5.2%, well above the 3% growth in 2022. “Macro data for 2023 shows that China’s economy is entering a period of transition to a new growth model,” said Zhiwei Zhang, President and Chief Economist of Pinpoint. Notes on asset management. “As investment in the real estate sector declines, the economy becomes more dependent on the manufacturing and services sectors…This transition will take time to complete.”
5. Full of debt
Even more companies As interest rates remain high, more people are defaulting on their debts, according to a new report from S&P Global Ratings. More than 150 companies defaulted on required debt payments last year, an 80% increase from the previous year and the highest default rate in seven years, excluding the 2020 coronavirus surge. And this year may be no exception. “We expect further credit deterioration globally in 2024, primarily at the lower end of the rating scale,” the firm wrote. “Despite the prospect of rate cuts, we expect funding costs to continue to rise.”
