STLA - Wall Street Breakfast Podcast: UAW Walkout

2023-09-15 06:36:44 ET

Summary

• UAW union begins simultaneous strike at Detroit Three automakers, affecting production of popular vehicle models.
• Media mogul Byron Allen makes a bid to purchase ABC TV network and other Disney networks.
• Procter & Gamble, Johnson & Johnson, and Walgreens face lawsuit over misleading claims about cold medicine drug.

Listen below or on the go on Apple Podcasts and Spotify

UAW walkout: First ever simultaneous strike begins at Detroit Three. (00:30) Byron Allen makes $10B offer for ABC, other Disney ( DIS ) networks - report. (01:58) P&G (PG), J&J (JNJ), Walgreens ( WBA ) face class action suit over cold medicine drug. (03:17)

This is an abridged transcript of the podcast.

The United Auto Workers union “Stand Up” strike against the big three automakers has begun.

A deal was not reached by midnight.

UAW members walked out of three plants including a General Motors Company ( GM ) facility in Wentzville, Missouri, a Stellantis ( STLA ) location in Toledo, OH and a Ford ( F ) assembly plant in Wayne, Michigan.

This is the first time that all three Detroit automakers were hit by a UAW strike at the same time.

More than 12,000 members are on strike now but more could stand up and walk out if the sides continue to be far apart on a deal.

In reference to the way the strike is structured, UAW President Shawn Fain said that “this strategy will keep the companies guessing.” He went on to say in a video statement , “if we need to go all out we will.”

The walkouts affect production of popular vehicle models including Ford Bronco, Jeep Wrangler and GMC Canyon.

At issue are the terms surrounding new four-year labor contracts. Demands range from higher wages, more paid time off, reduced workweeks, a return to traditional pensions, the elimination of wage classification tiers and a shift back towards cost-of-living adjustments.

The union represents about 146,000 workers at the big three companies.

Premarket Ford is down 2%, GM is down 1.7% and Stellantis is up 0.7%.

Media mogul Byron Allen made a $10 billion offer to Walt Disney (NYSE: DIS ) to purchase the ABC TV network, local stations, as well as the FX and National Geographic cable channels.

According to a Bloomberg report , which cited a person familiar with the matter, the bid is said to be preliminary and may be altered.

Allen is expected to work with banks and private equity companies to finance a potential deal.

The news comes after Bloomberg reported earlier Thursday that Disney ( DIS ) has held early talks about selling its ABC network and stations to broadcast group Nexstar Media Group (NXST).

The news followed a presentation by Nexstar adviser (and former president) Tom Carter Wednesday at a BofA conference, where he indicated Nexstar is interested in acquiring legacy assets from media names looking to restructure.

Disney said in a statement to Bloomberg earlier that while it’s considering strategic options for its traditional TV networks, no decisions on a sale have been made.

The bid for Allen, who owns the Weather Channel, comes after he reportedly was one of the bidders for BET Media Group, owner of VH1 and BET cable networks. The WSJ reported last month that Paramount ( PARA ) abandoned a plan to sell a majority stake in BET.

Procter & Gamble (NYSE:PG), Johnson & Johnson (NYSE:JNJ), and Walgreens Boots Alliance (NASDAQ: WBA ) have been named in a class action lawsuit in Florida over the use of a drug in popular over-the-counter cold remedies.

The suit accuses the companies of misleading consumers.

The deceit involves phenylephrine, a nasal decongestant.

On Sept. 12, a panel of FDA advisors unanimously agreed that phenylephrine lacks efficacy.

Kenvue (NYSE:KVUE), the former consumer health segment of J&J (JNJ), markets Sudafed and Benadryl, while P&G ( PG ) makes DayQuil and NyQuil. Versions of these products contain phenylephrine.

Reuters reported, the lawsuit says that the companies should have known by 2018 that claims about medicines containing phenylephrine were false and misleading.

Other headlines to look out for on Seeking Alpha:

California reaches $93M settlement with Google over violations of location privacy

Lennar fiscal Q3 earnings beat even as average home prices slip

Arm Holdings jumps 25% in market debut for a valuation of $68B

U.S. stocks ended solidly higher on Thursday.

The Nasdaq ( COMP.IND ) added 0.81%. The S&P 500 (SP500) advanced 0.84%, while the Dow ( DJI ) gained 0.96%.

Turning to the performance of the S&P 500 (SP500) sectors on Thursday, all 11 ended in positive territory, with Real Estate topping the leaderboard.

Looking at the fixed-income markets, Treasury yields were higher. The 10-year yield (US10Y) was up 4 basis points to 4.29%, while the 2-year yield (US2Y) was up 4 basis points to 5.02%.

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 mixed. The Dow is up 0.2%, the S&P 500 is up 0.1% and the Nasdaq is down 0.1%. Crude oil is up 0.3% at more than $90 a barrel. Bitcoin is down 0.1%.

In the world markets, the FTSE 100 is up 0.7% and the DAX is up 1%.

On today’s economic calendar at 8:30am empire state manufacturing and at 10am University of Michigan consumer sentiment.

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