A man walks through the Nasdaq MarketSite in New York on January 28, 2022.
Michael Ngale | Bloomberg Getty Images
Here are the most important news investors need to start their trading day:
1. Tech letdown
Meta raised everyone’s hopes with a refreshing talk of Wednesday’s efficiency, but the parent Facebook ultimately set the market up for a bummer after the bell on Friday. A major technology company Apple, Alphabet and Amazon All reported earnings, and all disappointed in some way, sent shares down in off-hours trading. Apple posted its biggest annual revenue decline since Barack Obama became president. Google’s parent Alphabet has seen a decline in ad spending on YouTube. And Amazon offered soft guidance as it wrapped up its slowest year of growth as a publicly traded company. Stock futures were in the red earlier Friday, particularly on the tech-heavy Nasdaq. Read live market updates.
2. Here comes the project report
People wait in line to attend a job fair at SoFi Stadium on September 9, 2021, in Inglewood, California.
Patrick T. Fallon | Afp | Getty Images
The January jobs report is due at 8:30 a.m. ET. Economists expect a slowdown – 187,000 jobs added vs. However, as CNBC’s Patti Domm points out, economists are uncertain about what impact the wave of tech layoffs will have on January’s numbers. Markets could react positively if the number is lower than expected, especially after Federal Reserve Chairman Jerome Powell this week acknowledged the “disinflationary” factor in the economy and made more dovish comments on rate hikes. “The market is desperate to find any excuse that the Fed will pivot,” said Jefferies economist Tom Simons.
3. Blue Oval Blue
The Ford company logo is displayed on a sign outside the Chicago Assembly Plant on February 03, 2021 in Chicago, Illinois.
Scott Olson Getty Images
Tech companies weren’t the only ones having a tough time with Thursday’s earnings. Ford sent an uglier than expected fourth quarter that was saddled with a net loss for the year. The company blamed “execution issues” and supply chain problems that resulted in 100,000 units less than expected sales, amounting to about $1 billion in missed revenue. Ford CEO Jim Farley vented his frustrations to CNBC’s Phil LeBeau, saying he understands the company is under pressure to turn things around quickly. He also asked for a little mercy from investors: “Be patient. You know, we got the right team. We got the right plan. We’re growing like in the pro and EV business.”
4. China’s Covid surge reduces Starbucks sales
Image by Alex Tai/SOPA | LightRocket | Getty Images
Coronavirus cases are on the rise in China after the government dropped its zero-Covid policy, putting more pressure on businesses. Starbucks there said transactions in coffee in China, the second largest market, fell by nearly 30% year-over-year in the most recent quarter. The company still stuck with its full-year guidance, despite declining results from China. And Starbucks also expects that to happen in the country during the second half of the fiscal year after negative same-store sales growth continued into the fiscal second quarter.
5. It is suspected that a Chinese spy balloon was spotted
A high-altitude balloon floats over Billings, Mont., Wednesday, Feb. 1, 2023. The U.S. tracked a suspected Chinese surveillance balloon seen in U.S. airspace for several days, but the Pentagon decided not to shoot it down. because of the risk of harm to people on the ground, officials said Thursday, February 2, 2023. The Pentagon would not confirm if the balloon in the photo was a surveillance balloon.
Larry Mayer The Billings Gazette | AP
American officials said on Thursday they were monitoring what they suspected to be a Chinese spy balloon floating north of the United States. China has sent spy balloons over the U.S. before, but not for long, officials told NBC News. The revelation about the balloon comes days before Secretary of State Antony Blinken is set to meet with Chinese President Xi Jinping. China, meanwhile, called for calm as it looked at the situation. U.S. defense officials have said the device’s intelligence-gathering capabilities are limited, and so far they have opted to fire it because of concerns that the debris could injure people and damage property on the ground.
– CNBC’s Jesse Pound, Patti Domm, Michael Wayland, Phil LeBeau and Amelia Lucas contributed to this report.
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