Hey Snackers,
Disney has again jacked up ticket prices for the busiest days at its California parks. Now Disney adults pining for a meet-ânâ-greet with Max Goof may have to fork over $200. Call it the priciest place on earth.
Stocks notched fresh records on Friday with the S&P 500 crossing 5,800 for the first time. Bank stocks rallied after JPMorgan Chase and Wells Fargo kicked off Q3 earnings szn with expectation-beating #s.
đ Nightmare before quizmas: Nothinâ spookier than failing this weekâs Snacks Seven quiz. Try to get a 7/7 after nailing the first q:
Uber just added a feature that lets riders opt for what? (Check your answer.)
Earnings szn kicks off as investors strap in for what could be a bumpy quarter
âTis the season to be profitable⌠The third-quarter earnings season started Friday with JPMorgan Chase unloading a solid earnings beat. But zooming out, analysts expect slower earnings growth generally after a blockbuster Q2 reporting season, when earnings per share popped 12%. Now, Wall Street estimates that S&P 500 cos will see earnings growth of roughly 4% (though historically most companies have beaten forecasts).
Market check-in: This month, the S&P 500 posted its fourth straight quarter of gains (its longest win streak since 2021) and is up 23% for the year.
Keepinâ score on Q4: Stocks cruised to records last week, but Octoberâs been rocky as traders weigh many moving pieces.Â
Not just earnings⌠Investors have a lot to chew on this quarter. Among the biggest:Â
Rate cuts: Lower interest rates tend to be good for stocks, and in September the Fed came in hot with a jumbo cut. But after a strong jobs report â and Fed Chair Powellâs comments that the bankâs in no rush to cut quickly â traders on Friday were betting on a 10% chance of no trim at all next month.
The economy: A soft landingâs looking more likely. Inflation kept cooling last month, and the US added about 100K more jobs than expected, while unemployment fell. Investors appear less worried about the economy, but that seems to be making them anxious that the Fed wonât cut rates fast enough.
US elections: Presidential elections tend to introduce a lot of uncertainty and volatility in markets in the months leading up to the big day. The candidates have different policies on things like corporate taxes, energy, and tariffs, which can influence market moves.Â
Middle East turmoil: Escalating conflict between Israel, Iran, and Iran-backed Hezbollah has led to spiking oil prices. Iran controls the Strait of Hormuz, through which 20% of the worldâs oil passes, and the worst-case scenario for oil markets is a blockage.
It could be a bumpy quarter⌠Uncertainty is typical in markets, but it seems as if there are more unknowns than usual in this last stretch of the year, from the tight election race to worsening global conflicts. Some uncertainty in markets isnât necessarily bad, but it can introduce even more volatility: this month the VIX â Wall Streetâs âfear gaugeâ â has spiked.
Coming up this week
Bingeing âLove Is Blindâ... until we can binge Netflixâs earnings call on Thursday. The stream leader beat estimates in April after ad-tier subscribers grew 34% while its global paid subs topped 277M (FYI: Netflix will stop breaking out sub #s next year as it focuses on revenue). The streamerâs password-mooching crackdown and its cheaper ad tier have prompted a wave of sign-ups, and the stockâs nearly 2xâd over the past year. The $7/month ad plan had 40M+ subscribers as of May, and Netflix is expected to see more growth from the new revenue stream.
Cleared to land⌠United Airlines is set to report Tuesday after a record-breaking summer-travel szn. In Q2 the carrierâs profit surged 23% from last year to $1.3B. But a cloudy Q3 forecast has investors jittery. Last week, Deltaâs third-quarter earnings growth missed estimates after the CrowdStrike-caused outage lost it $380M in sales (the six major airlines were expected to take a $860M hit from the IT debacle). Deltaâs holiday guidance also disappointed, though it said travelers have leaned into fall vacays to beat the summer heat.
Stories weâre watching
Look Ma, no hands⌠Tesla last week rolled out a prototype of a two-seat self-driving car (no steering wheel). Boss Elon Musk said the âCybercabâ will enter production by 2026 and retail for under $30K. After a light-on-details prezy, Tesla shares fell 8% as hype faded and skeptics raised unresolved qâs about safety and regulatory approval. The robotaxi road is already competitive: Alphabetâs Waymo is doing 100K+ paid driverless trips a week, and GMâs Cruise plans to offer autonomous rides on Uber next year. Amazonâs been testing its Zoox cars in California and plans to launch in Vegas this year.
Got beef⌠McDonaldâs, where menu prices are up an average of 40% since 2019, says higher subtotals are the result of meat-packersâ greedflation. This month, the home of Happy Meals filed a lawsuit accusing nine US meatpackers (including Tyson, JBS, and Cargill) of colluding to push up beef costs. The meatâs price is up 4.2% from last year, far outpacing pork and poultry. Many economists blame shrinking US cattle #s for the surge. As McDonaldâs beefs with meat-packers in court, itâs rolling out a chicken version of its Big Mac.
What else weâre Snackinâ
TD Bank agreed to pay a record $3B in fines to the DOJ after it became the first US bank to plead guilty to conspiracy to commit money laundering.
A fresh clue could solve the mystery of who was behind a $7B estate-tax payment made last year â the largest of all time.Â
The fragmented world of sports streaming has frustrated fans as the $8B biz of NFL streams forces viewers to switch between platforms.
Snack Fact of the Day
A record 11M+ fans attended Major League Soccer matches this season
This Week
Monday: Indigenous Peoplesâ Day
Tuesday: Earnings expected from Walgreens, United Health, Johnson & Johnson, Citigroup, Bank of America, Progressive, Goldman Sachs, PNC Financial Services, Ericsson, Interactive Brokers, and J.B. HuntÂ
Wednesday: Earnings expected from United Airlines, ASML, Morgan Stanley, Abbott, U.S. Bancorp, Citizens Financial Group, Synchrony Financial, Alcoa, PPG Industries, Equifax, and Discover
Thursday: Earnings expected from Blackstone, Netflix, TSM, Travelers, Elevance Health, Infosys, M&T Bank, and Truist Financial
Friday: Earnings expected from American Express, SLB, Procter & Gamble, and Fifth Third Bancorp
Sunday: F1 US Grand Prix
Authors of this Snacks own shares of: Alphabet, Amazon, Delta, Disney, GM, Tesla, and Uber