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- BREAKING: The Numbers Are In
Good Morning!
Happy Thursday! One more day until Friday:
👉GDP numbers are in
👉Stellantis earnings are in
👉Big changes at Southwest
GDP: Surpassed Growth
US economic growth surpassed expectations in the second quarter, with GDP increasing at an annualized rate of 2.8%, up from 1.4% previously. Personal spending, a key growth driver, rose 2.3%, also exceeding forecasts.
Source; CNBC
Underlying inflation increased by 2.9%, easing from the first quarter but still higher than expected. Despite the growth, the economy shows signs of cooling due to high interest rates, helping to gradually control inflation. This trend is promising for the Federal Reserve's efforts for a soft landing and potential rate cuts by September. Treasury yields edged up, and stock futures remained lower post-report, with policymakers meeting next week.
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EARNINGS: Stellantis
Stellantis reported a sharp drop in first-half net profit, down 48% to 5.6 billion euros ($6.07 billion), citing reduced volumes, temporary production gaps, and lower market share in North America. Adjusted operating income fell to 8.5 billion euros, a decrease of 5.7 billion euros from last year. Milan-listed shares dropped 8.5%.
Source; Bloomberg
CEO Carlos Tavares attributed the decline to operational issues, especially in the U.S., including inventory and manufacturing problems. Despite these challenges, Stellantis reaffirmed its 2024 guidance, expecting a double-digit adjusted operating income margin and a 7.7 billion euro capital return to investors. First-half net revenues were 85 billion euros, down 14%.
SOUTHWEST: Big Changes
Southwest Airlines is making significant changes to its business model, ending open seating and introducing extra legroom seats to boost revenue. Starting next year, the airline will sell tickets for these extra legroom seats and begin offering overnight flights in February.
Source: Southwest
Research showed that open seating was a major reason customers chose competitors, with 80% preferring assigned seats. Despite these changes, Southwest will maintain its two-free checked bags policy. This shift comes after Elliott Investment Management took a $2 billion stake in Southwest, urging the airline to improve its performance.
Chart of the Day
📊 Email Scams
Source: @CNBC
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Source: @wallstreetoasis
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