STLA - Wall Street Breakfast Podcast: Ford UAW Strike Deal

2023-10-26 06:38:03 ET

Summary

• Ford and UAW reach tentative agreement to end six-week-long strike.
• Meta Platforms posts strong revenues and profits, but sees softer ad spend in Q4.
• UPS acquires Happy Returns from PayPal to expand its network of return locations.

Listen below or on the go on Apple Podcasts and Spotify

Ford (F), UAW reach tentative contract to end strike. (00:24) Meta Platforms ( META ) posts hefty surprise as revenues, profits, users all top forecasts . (01:39) UPS acquiring Happy Returns from PayPal (PYPL). (02:54)

This is an abridged transcript of the podcast.

Ford Motor (NYSE: F ) and the United Auto Workers (UAW) have agreed on a tentative agreement to end a six-week-long strike.

The agreement will still need approval from a simple majority of the 57K Ford ( F ) workers represented by the union.

UAW President Shawn Fain along with Vice President Chuck Browning released a 10 minute video just before 8:30 Wednesday night calling the tentative agreement with Ford a “major victory.”

Some of the details were released but Fain said the members will have all the details no later than this weekend.

The leaders said the UAW-Ford workers will get a 25% general wage increase over four years .

Browning noted that with cost of living adjustments, the top rate will increase 30% to more than $40 an hour.

He added that over the life of the contract, temporary workers will see raises of more than 150%.

The next step is for UAW National-Ford Council leadership to meet on Oct. 29 and vote whether to send it to members for final approval.

For now, Ford strikers can go back to work. Fain and Browning said this is a strategic move to keep pressure on Stellantis ( STLA ) and GM.

Premarket Ford is up 1.4%.

Meta Platforms (NASDAQ: META ) is down 2.9% premarket after rising 4% in early postmarket action Wednesday.

Meta gave up those gains toward the end of its conference call -- after its third-quarter earnings beat expectations on top and bottom lines.

Revenues rose 23% to $34.15B (in constant currency, they rose 21%) -- and with costs and expenses declining 7%, operating income for the quarter jumped 143% to $13.75B.

Operating margin doubled year-over-year, to 40% from the prior-year quarter's 20%.

And net income correspondingly jumped 164% to $11.58B from a year-ago $4.4B.

"We had a good quarter for our community and business," CEO Mark Zuckerberg said in his usually terse initial reaction. "I'm proud of the work our teams have done to advance AI and mixed reality with the launch of Quest 3, Ray-Ban Meta smart glasses, and our AI studio."

However, on the earnings call the company’s Chief Financial Officer said they’ve observed softer ad spend in the beginning of the fourth quarter.

Meta Platforms earnings is the top story in the Wall Street Breakfast newsletter our daily one page news summary. Check it out for a complete analysis of META.

United Parcel Service (NYSE: UPS ) is buying software and reverse logistics company Happy Returns from PayPal (NASDAQ: PYPL ). Financial terms were not disclosed.

Happy Returns' software allows customers to access a returns portal, make a box-free return at many locations, and have their item shipped back to the merchant. The company currently has 800 merchant customers.

UPS ( UPS ) said that by combining its own network of ~5.2K UPS Stores with Happy Returns existing drop-off points, customers will have access to more than 12K locations to return items.

The deal is expected to close in Q4.

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Apple AirPods getting a makeover: report

California’s Cruise incident could have bigger ramifications for the self-driving vehicle industry

Choice Hotels calls on Wyndham to engage in merger talks

U.S. stocks on Wednesday ended deep in negative territory, as a slide in shares of Alphabet ( GOOG ) ( GOOGL ) along with a renewed surge in Treasury yields put pressure on equities.

The Nasdaq ( COMP.IND ) retreated 2.43% posting its worst day since February 21. A nearly 10% slump in Alphabet ( GOOG ) ( GOOGL ) heavily weighed on the index.

The S&P 500 ( SP500 ) ended 1.43% lower. The Dow ( DJI ) outperformed the other two averages, slipping only 0.32%.

Nine of the 11 S&P sectors closed in negative territory, with Utilities and Consumer Staples the only two gainers. Communication Services saw an outsized loss of nearly 6%.

After two straight days of relative calm in the fixed-income markets, longer-end Treasury yields resumed their climb on Wednesday as bonds sold-off. The 30-year yield ( US30Y ) was up 12 basis points to 5.08%, while the 10-year yield ( US10Y ) was up 11 basis points to 4.95%. The 2-year yield ( US2Y ) was up 2 basis points to 5.12%.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the red. The Dow is down 0.3%, the S&P 500 is down 0.6% and the Nasdaq is down 1%. Crude oil is down 1.1% at more than $84 a barrel. Bitcoin is up 0.3% and above 34,000.

In the world markets, the FTSE 100 is down 0.6% and the DAX is down 1.5%.

The biggest movers for the day premarket: Align Technology (NASDAQ: ALGN ) is down 25% after the company missed the consensus mark in Q3, cut its full year revenue guidance, and warned of deteriorating market trends. And Endeavor (NYSE: EDR ) is up 21% following Silver Lake's proposal to take the firm private .

On today’s economic calendar,

• 8:30 am Q3 GDP

• 10 am pending home sales

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