A screen shows the Fed’s rate announcement as a trader reacts at the New York Stock Exchange (NYSE) in New York City, U.S., July 27, 2022.
Brendan McDermid | Reuters
Here are the most important news investors need to start their trading day:
1. Take stock of a summer Friday
2. Amazon: Indeed, consumers are fine
An Amazon Prime truck driver is seen in Los Angeles, California on Amazon Prime Day on July 12, 2022.
Frederick J. Brown | AFP | Getty Images
Well, Amazon consumers, anyway. Shares of the e-commerce giant fell earlier this week as Walmart cut its profit outlook as record levels of inflation weigh on consumers. But Amazon executives said Thursday, when the company released quarterly earnings, that inflation was not hitting its customers as hard as other retailers. That’s because Amazon and Walmart attract different customers. “Amazon’s core consumer is more affluent than Walmart’s consumer, and that seems to be allowing it to outperform Walmart,” said Tom Forte, an analyst at DA Davidson. Amazon shares rose sharply in premarket trading. CNBC’s Annie Palmer breaks it down here.
3. The iPhone is coming
A customer holds the new green Apple iPhone 13 pro shortly after it went on sale at the Apple Store on 5th Avenue in New York on March 18, 2022.
Fresh Mike | Reuters
Apple shares rose in premarket trading after the giant gadget maker beat Wall Street expectations on quarterly earnings and revenue. The kids of Cupertino can thank their pride and joy, the good and reliable iPhone. The strong sales came despite the iPhone 13 being in the second half of its product cycle, meaning a new model is coming soon. “We had a record level of switches and saw double-digit growth for new customers on iPhone,” said CEO Tim Cook. While Cook said the company expects revenue growth to be strong in the current quarter, he did cite “pockets of softness.” Slowing growth in Apple’s services is a potential area of concern, writes CNBC’s Kif Leswing.
4. JetBlue’s next destination
LaGuardia International Airport Terminal A for JetBlue and Spirit Airlines in New York.
Leslie Josephs | CNBC
It took months, lots of back-and-forth, multiple bids and a few delayed shareholder votes, but JetBlue finally did it. The airline convinced low-cost carrier Spirit to abandon its merger with low-cost carrier Frontier and agree to be acquired by JetBlue in a $3.8 billion deal. Now comes the hard part for JetBlue and Spirit: getting the merger-skeptic Biden administration to sign off on the acquisition. For example, the Justice Department sued last year to block JetBlue’s Northeast alliance with American Airlines. This case will go to trial in September. Still, JetBlue is bullish and expects regulators to sign off on the Spirit deal late next year or early 2024, and the merger will be completed in the first half of 2024. CNBC’s Leslie Josephs explains here.
5. Biden and Xi speak at a tense moment
US President Joe Biden and Chinese President Xi Jinping held a phone call on Thursday. Pictured here is their virtual meeting on November 15, 2021.
Mandel Ngan | Afp | Getty Images
US President Joe Biden and Chinese President Xi Jinping spoke for more than two hours on Thursday and began setting up their first face-to-face meeting since Biden’s inauguration. The lengthy conversation between the two superpower leaders came after the House sent a bill to boost America’s competitiveness with China to Biden, and as the world turns its attention to Taiwan, the self-governing island that China claims as its own. House Speaker Nancy Pelosi, D-Calif., has indicated she may visit Taiwan during a swing through Asia starting this week, which could inflame U.S.-China relations. Meanwhile, earlier this week, The New York Times reported that US officials are increasingly worried that China could move against Taiwan in the next 18 months. Despite all that, it appears that Biden and Xi had a constructive call, according to experts. Read CNBC reporter Evelyn Cheng’s presentation from Beijing here.
– CNBC’s Jesse Pound, Annie Palmer, Kif Leswing, Leslie Josephs and Evelyn Cheng contributed to this report.
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