The Week's Top Stories is a guided tour through the biggest market stories of the week, from winning stocks to brutal dips to the facts and forecasts generating buzz on Wall Street.
RATE HIKE WORRIES
The Federal Reserve Open Market Committee is meeting next week, and that means many investors are wondering whether the central bank will hit markets with another rate hike. The Fed took a break from tightening at its last meeting on the heels of multiple reports showing a slowdown in inflation, but Fed Chair Jerome Powell noted that at least one more rate hike was on the horizon. Whether that happens next Wednesday or later this year is the question haunting markets going into the weekend.
TESLA CRASH
Shares of Tesla crashed more than 9 percent for the week after CEO Elon Musk disclosed that production is set to slow down this quarter due to "global factory upgrades." He said the target for the year is still 1.8 million vehicle deliveries, but could see a lull in the third quarter. The company also announced that it's recalling 16,000 of its Model S and Model X vehicles from 2021-2023. The recall is related to an issue with the first-row seat belt.
GAMING MERGER
The Federal Trade Commission is backing down from an appeal to a recent ruling giving Microsoft the go-ahead to complete its acquisition of Activision Blizzard. The two companies recently announced an extension of the deadline for finishing the merger to October 18, giving them more leeway to secure government approval. They can continue to negotiate with other countries' regulatory authorities, including the United Kingdom's Competition and Markets Authority.
BANKING PROFITS
Bank of America earlier this week reported a 19 percent jump in net income from a year ago, while revenue shot up 11 percent. CEO Brian Moynihan said the strong earnings were the result of a "healthy U.S. economy" and a "resilient job market." The results also indicate that the bank's size and diversity has helped it avoid the headwinds facing smaller regional banks, and that its still able to make money on loans even as it pays out more for deposits due to higher interest rates.
Updated Tesla stock drop after close of markets Friday.
An independent watchdog within the IRS reports that while taxpayer services have vastly improved, the agency is still too slow to resolve identity theft cases. And National Taxpayer Advocate Erin Collins says those delays are “unconscionable.” Erin M. Collins said in the report released Wednesday that overall the 2024 filing season went smoothly, though IRS delays in resolving identity theft victim assistance cases are worsening. It took nearly 19 months to resolve self-reported identity theft cases as of January, and Wednesday's report states that now it takes 22 months to resolve these cases.
Amazon.com Inc. surpassed $2 trillion in market value for the first time in afternoon trading on Wednesday. The push higher for Amazon’s stock market valuation comes a little more than a week after Nvidia hit $3 trillion and briefly became the most valuable company on Wall Street. Nvidia’s chips are used to power many AI application and its valuation has soared as a result. Amazon has also been making big investments in AI as global interest has grown in the technology. Most of the company’s focus has been on business-focused products.
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