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Here are the most important news items that investors need to start their trading day:
1. Rally fizzles
The good times couldn’t last forever. After a late-year rally that brought a record high, the Dow fell 476 points, or 1.27%, Wednesday, its first decline in 10 days. The S&P 500, meanwhile, shed 1.47% — led lower by FedEx, which lost 12% as weaker demand hit its revenue outlook — and the Nasdaq dropped 1.50%. “Markets were becoming overbought, and a pullback like this is natural given those conditions,” said Keith Buchanan, senior portfolio manager at Globalt Investments. “So it was more technical than fundamental.” The good news? All three indexes remain on track for a winning December and 2023. Follow live market updates.
2. Media moves?
Warner Bros. Discovery held early merger talks with rival Paramount Global. The CEOs of the two media companies met Tuesday for preliminary discussions to outline a possible deal, sources told CNBC. Paramount, which includes its namesake movie studio and broadcast network CBS, is carrying a hefty debt load and has been the source of much speculation recently. But it’s still early in the process and a lot could change between now and any potential deal. CNBC’s Alex Sherman reports that the discussions should be seen as a kickoff to the next chapters for Warner Bros. and Paramount and such talks could lure Comcast‘s NBCUniversal to the table, as well.
Read more: 13 media executives offer anonymous predictions on what will happen to the industry in 2024.
Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.
3. Citigroup cuts
Jane Fraser, CEO of Citigroup, attends a hearing on Annual Oversight of Wall Street Firms before the Senate Committee on Banking, Housing, and Urban Affairs in Washington, D.C., the United States, on Dec. 6, 2023.
Aaron Schwartz | Xinhua News Agency | Getty Images
Citigroup is closing another business as part of an ongoing overhaul of the bank. The company is shuttering its global-distressed debt group, which trades the bonds and other securities of companies in or approaching bankruptcy, sources said. That business employed about 40 people. CEO Jane Fraser has closed operations and is considering deep cuts as part of a corporate reorganization plan, known internally as “Project Bora Bora.”
4. Such great heights
A Southwest Airlines Boeing 737-700 aircraft lands at Ronald Reagan Washington National Airport in Arlington, Virginia, May 7, 2023.
Nicolas Economou | Nurphoto | Getty Images
It’s been a big year for labor unions — and pilots. American, United and Delta finalized billion-dollar deals earlier this year that gave aviators double-digit pay hikes. Now, Southwest Airlines is on the cusp of a $12 billion preliminary labor agreement that would give pilots 50% cumulative pay increases over the five-year contract’s span. It could end years of tense negotiations. Southwest pilots and flight attendants have pushed for better working conditions, such as more predictable schedules.
5. Retail investor stardom
In this photo illustration a Tesla logo seen displayed on a smartphone with the stock market graphic in the background.
Omar Marques | LightRocket | Getty Images
Retail investors are putting more money than ever into Tesla. Vanda Research says the stock is on pace to attract the largest flow of individual investor dollars of any security this year — which is especially notable because it entered the S&P 500 three years ago this week. In 2019, Tesla wasn’t even cracking the top 20 stocks that individual investors bought. Everyday investors say they like Tesla because of its disruptive technology and its focus on the future. “Retail tends to trade on guts and heart,” Roth MKM analyst Craig Irwin said. “And a lot of people love Tesla.”
— CNBC’s Sarah Min, Alex Sherman, Mike Calia, Hugh Son, Leslie Josephs and Alex Harring, contributed to this report.
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