Traders work on the floor of the New York Stock Exchange on April 26, 2023 in New York City.
Michael M. Santiago | Getty Images
Here are the most important news items that investors need to start their trading day:
1. Tech vs tank
Stocks have stumbled a bit these past few days. Even as tech giants have done well with their earnings report (more on that below), worries about First Republic‘s troubles (more on those below, too) have weighed on the minds of investors who are concerned about a revival of last month’s banking crisis. Markets will have even more big earnings reports to chew over Thursday, with Merck and American Airlines posting results before the bell and Amazon and Intel due after the close. The U.S. GDP print for the first quarter is also due Thursday morning. Follow live market updates.
2. Meta physics
Founder and CEO of US online social media and social networking service Facebook Mark Zuckerberg reacts upon his arrival for a meeting with European Commission vice-president in charge for Values and Transparency, in Brussels, on February 17, 2020.
Kenzo Tribouillard | AFP | Getty Images
What went down is going up again. Meta‘s earnings report blew away Wall Street on Wednesday, sending the Facebook parent’s stock surging more than 10% in extended trading. That means it’s primed to build on its already huge 2023 – its shares were up more than 74% through Wednesday’s close after losing two-thirds of their value last year. So what impressed investors so much? Revenue rose unexpectedly, and for the first time in three quarters. Its forecast for the current quarter also topped estimates, as did its average revenue per user. There was so much good stuff in the report that investors pretty much ignored the fact that the company’s metaverse business lost another $3.99 billion during the quarter.
3. First Republic problems
4. Disney takes DeSantis to court
Walt Disney World fireworks display in Orlando, Florida.
Joe Burbank | Orlando Sentinel | Getty Images
Florida Gov. Ron DeSantis is reportedly preparing to run for president, with an announcement expected in May. But he isn’t just going to be tangling with Donald Trump for the GOP nomination in the near future. DeSantis and Disney‘s war, which started last year after the Mouse House criticized Florida Republicans’ so-called “Don’t Say Gay” bill, escalated Wednesday. The governor’s hand-picked Disney resort oversight board voted to override a development deal struck by a separate board allied with the company. Disney rapidly fired back by suing DeSantis and his allies, alleging political retribution. “There is no room for disagreement about what happened here: Disney expressed its opinion on state legislation and was then punished by the State for doing so,” the company’s suit reads. DeSantis’ office fired back: “This lawsuit is yet another unfortunate example of their hope to undermine the will of the Florida voters and operate outside the bounds of the law.”
5. Debt on arrival
House Speaker Kevin McCarthy (R-CA) walks following a closed door meeting on Captiol Hill in Washington, April 26, 2023.
Tom Brenner | Reuters
It took a lot of horse trading among his fellow Republicans, but House Speaker Kevin McCarthy got his debt ceiling bill passed. Granted, he did so with the thinnest of margins. Four Republicans voted with Democrats against the bill, making the tally a mere 217-215. The measure, which calls for broad spending cuts in return for raising the debt limit for about a year, is almost certainly going nowhere in the Democratic-controlled Senate. But it is a gambit to coax President Joe Biden to the negotiating table, as he has refused to compromise over raising the debt limit. McCarthy’s bill hasn’t moved the needle, though. “The President has been clear that he will not accept such attempts at hostage-taking. House Republicans must take default off the table and address the debt limit without demands and conditions,” the White House said Wednesday.
– CNBC’s Hakyung Kim, Jonathan Vanian, Jesse Pound, Kevin Breuninger and Christina Wilkie contributed to this report.
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