business

The Week's Top Stories: Banks Boom, Plug Power & Virgin Galactic

From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.

BANK BLING

Big banks were all about the benjamins this week. JPMorgan, Goldman Sachs, Bank of America, Citigroup, Wells Fargo, and Morgan Stanley smashed expectations in their quarterly earnings reports as the economy finds its footing on the other side of the COVID-19 pandemic. As finances stabilize, fewer loans needed to be written off, meaning the Wall Street giants should be able to hold on to more of their cash. And mergers and acquisitions are also driving revenue with Goldman reporting a 60 percent jump thanks to this summer's crazy deal-making. Of course, this isn't to say it's all rays of sunshine (or that the pandemic is actually over). Low interest rates that many have been enjoying to buy homes and cars (when they can find either one) are making it tough for banks to grow their profits. Though all of the banks' stocks grew after the reports, they were battling sell-offs from earlier in the week. At the close of Friday, BoA was up 4 percent, Goldman Sachs more than 3 percent, Morgan Stanley was up 2 percent, Wells Fargo and Citigroup were nearly flat, and JPMorgan was down more than 2 percent.

PLUG POWER UP

Plug Power, a company that develops hydrogen fuel cell systems as a conventional battery replacement, had its own power surge this week after it got a "buy" upgrade from Morgan Stanley. The company also announced a new partnership with Airbus, which is looking to develop a zero-emissions aircraft by 2035. It also held its Plug Symposium on Thursday where it updated its guidance for investors, announced a partnership to build a gigafactory in Australia, and a new van prototype. All the news swirling around the firm sparked an almost 15 percent jump in its stock price for the week.

FALLING OUT OF ORBIT

Virgin Galactic stock crashed down Friday after the company announced it will delay its commercial space flights. It said it found an issue with materials during regular testing, so it'll have to address that, which means we're looking at Q4 of 2022 before we might really see commercial space tourism pick up from Richard Branson's outfit. This also comes right after Virgin was grounded for a month after its maiden voyage, with Branson aboard, went off course during its descent. It must be a particularly bitter pill to swallow after rival Jeff Bezos' Blue Origin launched another successful flight this week with Star Trek star William Shatner aboard. After the flight, Shatner told Bezos, "Whatever those other guys are doing...I don't know about them. What you've given me is the most profound experience I can imagine. " Virgin Galactic stock plunged more than 13 percent for the week.

SOUTHWEST TO SHOW LUV

There was a lot of turbulence for Southwest Airlines this week after a much-publicized flood of flight cancellations over the weekend made headlines. Allegations that the problems were due to a labor action by the pilots union or a worker shortage were refuted by the union and the company. "The weekend challenges were not a result of Southwest employee demonstrations," said airline spokesman Chris Mainz. The company claimed that weather and air traffic control issues contributed to the disruptions (although not everybody is buying that excuse), but whatever the reason, the snafu was enough to get both the CEO and COO of the company to issue formal apologies to customers and offer Southwest LUV vouchers to affected passengers for future travel. The stock went south, dropping more than 3 percent.

DRAFTKINGS TEAMS WITH NHL

DraftKings scored a big goal on Wednesday, becoming the National Hockey League's official sports betting, daily fantasy sports, and iGaming partner. The deal also included another partnership between DraftKings and Turner Sports, which broadcasts some of the hockey games, to be the network's sportsbook and fantasy sports provider as well. Turner also owns Bleacher Report, which is in on the deal. And this all came after Citigroup gave the sports gambling company its first rating, listing it as a "buy" on Monday. Still, despite the positive news, DraftKings' stock was largely flat, dropping less than a percent for the week. The company also announced on Friday that its Q3 earnings will be released on November 5.
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