2023-04-03 07:15:57 ET
Listen on the go! Subscribe to Wall Street Breakfast on Apple Podcasts and Spotify McDonald's ( MCD ) reportedly orders offices closed ahead of expected layoffs. OPEC+ announces surprise oil production cu t. World Wrestling ( WWE ) Entertainment reportedly close to sale to Endeavor (EDR). Learn more about these stocks with Seeking Alpha Premium .
Below is an abridged transcript of the podcast.
Good morning today is Monday, April 3rd and I'm your host Julie Morgan…
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McDonald’s is reportedly laying off workers in its corporate office. Employees were told not to report to the office so that the company can deliver the news virtually.
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Today is catalyst watch Monday but we’ll have to wait until the end of the week for the major news of the week, the jobs report…sb…
- OPEC+ announces a surprise oil production cut. I’ll give you a heads up now. Crude oil is up more than 5 percent. The same is true for Brent.
OUR TOP STORY
McDonald's has reportedly told corporate employees that its U.S. offices will remain closed early this week so the company can announce layoffs as part of a broad restructuring plan.
No word on how many people will be laid off.
The Wall Street Journal quoted an internal email to employees as saying that staffers should work from home Monday through Wednesday so the fast-food giant can deliver layoff news virtually.
The publication said the memo also instructed U.S. and some international corporate staffers to cancel all in-person meetings at the company's Chicago headquarters.
Analysts expect McDonald's to report Q1 earnings later this month. The fast-food chain beat analyst estimates on Q4 earnings and revenues in January.
However, the company spooked the market after management warned that higher input costs meant 2023 operating margins could fall below what were then analysts' consensus estimates.
Invest Heroes published an article on Seeking Alpha about McDonald’s entitled It Is Not Interesting Yet. In the article they rate the stock a hold. They say even though McDonald’s plans significant restaurant expansion next year, rising floor wages and franchisee support costs will continue to put pressure on the company's profitability.
I’ll leave a link to the Invest Heroes author page in show notes.
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Major oil producers in the OPEC+ group announced a surprise addition to production cuts Sunday.
According to Refinitiv data from Reuters, Saudi Arabia, the top producer in the group that includes Russia, will cut 500K barrels per day.
The total new cuts are about 1.16 million barrels per day, bringing total cuts including the previous 2M barrels per day to about 3.66M.
Russia reportedly made a cut of 500K barrels per day until the end of this year.
We’ll check crude oil prices in a few minutes.
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Today is catalyst watch Monday so we’re checking what could move markets this week.
That was Kim Khan, he’s the Senior Managing News Editor at Seeking Alpha.
Every week Seeking Alpha publishes a catalyst watch article. It’s published around 3 p-m every Friday.
I’ll leave a link to the article in show notes.
When you look at the article you’ll notice for today you should look out data reports from the likes of Tesla, Rivian, and XPeng.
Tesla reported on Sunday that it delivered 422,875 vehicles in Q1 to edge past the consensus expectation for 421.2K deliveries.
XPeng delivered 7,002 Smart EVs, up 17% M/M, bringing Q1 total deliveries to 18,230 vehicles.
NOW MORE ON THE MARKET
U.S. stocks on Friday ended higher for a third straight session.
The Nasdaq ended up 1.74%. The S&P 500 was higher by 1.44% and the Dow added 1.26%.
All 11 S&P sectors ended in the green, led by Consumer Discretionary, Real Estate and Communication Services. Energy rose the least.
For the week, all three major averages posted gains of more than 3% each.
Economic data showed that the core personal consumption expenditures index - the Fed's preferred gauge of inflation - gained +0.3% in February, slower than the +0.6% rise in January. On a Y/Y basis, core PCE came in at 4.6%, slightly lower than the forecasted 4.7% level.
Turning to the fixed income markets, Treasury yields were lower, with the longer-end 10-year yield dropping 7 basis points to 3.48% and the more rate-sensitive 2-year yield slipping 5 basis points to 4.05%.
MORE OF OUR TOP STORIES
World Wrestling Entertainment is reportedly closing in on a deal to be sold to Endeavor Group Holdings.
Endeavor is the parent company of the mixed martial arts league Ultimate Fighting Championship.
According to CNBC, the sale is in advanced talks and it could be announced as soon as Monday.
According to the report, it would result in a new publicly traded company focused on combat sports and entertainment and Endeavor would own 51% while WWE holders would own 49%.
This of course would mean the end of Vince McMahon's control of WWE.
The latest analyst article on World Wrestling Entertainment is an editor’s pick and it’s entitled Ranking the WWE buyout options.
In the article the author rates the stock a hold. One of the buyout options ranked is Endeavor Group Holdings.
They say Endeavor is a perfect match for WWE but the company’s balance sheet is not a thing of beauty.
I’ll leave a link to that article in show notes.
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The European arm of collapsed cryptocurrency exchange FTX has set up a website to pay back impacted customers,
According to a release dated Friday, customers' balances will be verified and then withdrawal requests can be made through the new site.
FTX EU customers were notified about the arrangement on Thursday via email.
FTX EU only became available last March, about eight months before its parent company, FTX filed for bankruptcy protection.
In February, FTX Japan became the first FTX subsidiary to resume customer withdrawals.
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Now let’s take a look at the markets as of 6:20 am. Ahead of the opening bell today, the Dow, S&P and Nasdaq futures are mixed. The Dow is up 0.4%. The S&P 500 is flat and the Nasdaq is down 0.5%.Crude oil is up 5% percent at 50 cents shy of $80 a barrel. Bitcoin is flat at $28, 388 dollars.
In the world markets, the FTSE 100 is up 0.8%. The Dax is up 0.2%.
On today’s economic calendar, at 9:45 am the PMI Manufacturing Index and at 10 am construction spending.
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Wall Street Breakfast Podcast: McDonald's Reportedly Preparing Layoffs