Here are the key updates that investors should know before they start trading today:
1. Good Earnings
Companies in the U.S. are reporting better-than-expected earnings, which is pushing stock prices up. On Wednesday, the S&P 500, a measure of many large U.S. companies, went up by about 0.8%, almost reaching 5,000 points for the first time ever. Other major indexes like the Nasdaq Composite and the Dow Jones Industrial Average also increased.
Shares of Walt Disney went up before the market opened on Thursday because the company showed strong earnings growth without much increase in sales. So far, around half of the companies in the S&P 500 have reported their earnings for the fourth quarter of last year. Compared to the same period last year, their earnings have gone up by 8.1%, while sales have only increased by 3.2%.
The release of the weekly jobless claims data will help determine whether stocks reach another record high on Thursday.
2. Disney’s Strong Moves
Disney made some impressive moves after releasing its results on Wednesday. They surpassed earnings expectations for the first fiscal quarter and also announced they would increase dividends and buy back more shares. But that’s not all.
Disney revealed plans to invest $1.5 billion in Epic Games, marking its biggest venture into the gaming industry yet. They will collaborate with the makers of Fortnite to develop new games and a whole new universe. Furthermore, during the earnings call, CEO Bob Iger announced that Taylor Swift’s Eras Tour movie will be available on Disney+ starting March 15.
Additionally, Iger mentioned that ESPN will launch its own streaming service in the fall of 2025, alongside the joint sports platform they announced with Fox and Warner Bros. Discovery.
3. Struggling Bank
Investors are paying close attention to the performance of regional banks as the one-year mark since the March 2023 crisis approaches. On Wednesday, shares of New York Community Bank experienced volatility after Moody’s Investors Service lowered its credit rating by two levels to junk status.
The bank also announced that its chairman, Alessandro DiNello, would take on a more active role to stabilize its operations. The bank’s shares have plummeted, losing over 50% of their value this year. These actions reflect worries that smaller banks are facing challenges due to reduced profits and real estate losses
4. Ackman’s New Investment Venture
Bill Ackman, a billionaire hedge fund manager from Pershing Square, is preparing to introduce a new investment opportunity on the New York Stock Exchange. This fund won’t have a minimum investment requirement and intends to invest in around one to two dozen well-established large companies in the U.S. that exhibit long-term growth potential, as stated in a regulatory filing.
This initiative aims to capitalize on Ackman’s appeal to everyday investors. Lately, Ackman has been striving to broaden his appeal beyond just the financial community on Wall Street.
5. Arm’s Success
Arm, a company that creates chips for smartphones and various other gadgets, surpassed earnings expectations and provided a positive outlook, attributing its sales growth to the influence of artificial intelligence (AI).
In after-hours trading, the company’s stock surged by up to 41%. Arm joins the ranks of recent successes in the stock market, which has been largely influenced by technology firms and the potential for AI-driven growth.
American companies are doing well financially. Disney is making big moves in investments and streaming content. A local bank is having a tough time. A rich guy named Bill Ackman is starting a new investment thing that anyone can join. A company called Arm is doing great because of AI.