What Moved The Markets This Week 📈
W11 - Meta Cuts Another 10K Jobs, OpenAI Launches GPT4.0, Wholesale Inflation Unexpectedly Drops, Swiss National Bank To Backstop Credit Suisse, ECB Hikes 50bps, and Adobe + GitLab Earnings
Sunday Morning Markets
Trading Week 11, covering Monday, Mar 13 through Friday, Mar 17. Your weekly financial markets update, in less than 5 minutes.
The Week In Review ⏪
February Inflation: CPI 0.4% (0.4% exp) <> PPI -0.1% (0.3% exp)
US banks deposit $30B into First Republic to shore up liquidity
Meta’s next phase of major restructuring includes 10K job cuts
OpenAI launches GPT4.0 with substantial accuracy improvements
HSBC acquires SVB.UK subsidiary for just £1
Swiss National Bank agrees to bank stop the failing Credit Suisse
ECB hikes interest rates 50 bps despite ongoing turmoil
Finance YouTubers sued $1B for promoting FTX fraud
Earnings from Adobe, GitLab, & more — view breakdowns below
US Markets 🇺🇸
Consumer prices jumped 0.4% in February and 6% for the year, in line with expectations. Excluding food and energy, core CPI increased 0.5% during the month, slightly higher than expected. Inflation data remains hot.
Wholesale prices unexpectedly declined 0.1% during the month versus estimates of a 0.3% increase. On a 12-month basis, the PPI index increased 4.6%, well below the 5.7% level seen in January as prices continue to decelerate.
Eleven banks deposit $30B into First Republic as a sign of confidence in the US banking system. Bank of America, Wells Fargo, Citi, and JPMorgan contribute $5B each as other smaller banks deposit $1B to $2.5B.
Meta announces plans to lay off another 10K workers and close 5K open positions as the company focuses on flattening the organization, canceling lower-priority projects, and reducing hiring rates. The restructuring will cost $3B - $5B.
OpenAI launches new GPT-4 model that is materially more accurate than previous models. GPT-4 can also accept images as input and derive context from them. The new model performed at the 90th percentile in a simulated Bar exam.
Microsoft unveils new AI office “Copilot” to help boost employee productivity. Copilot will integrate with the 365 product suite including Word documents, Excel spreadsheets, PowerPoint presentations, and Outlook emails. Watch demo.
Rest of World 🌏
Swiss National Bank will backstop Credit Suisse with liquidity after the Saudi National Bank ruled out further assistance. The firm saw withdrawals of more than ~$120B in Q4 after several scandals and compliance failures.
ECB hikes key interest rates by 50 bps despite the ongoing market mayhem, but signaled that they will supply liquidity to banks if needed. The latest inflation data shows headline prices remain up 8.5% for the year, well above the 2% target.
HSBC acquires SVB UK for just £1 in a deal that excludes the assets and liabilities of its parent company. The deal “strengthens our commercial banking franchise and enhances our ability to serve innovative and fast-growing firms.”
Samsung to invest $228B into new semiconductor plant in what will become the largest chip factory in the world. The move is part of a broader push to boost its prowess in areas including chips, displays, batteries, and electric vehicles.
Crypto ⚡
Finance YouTubers sued over the promotion of FTX after they allegedly promoted the crypto exchange without disclosing compensation. The suit is targeting Graham Stephen, Ben Armstrong, Andrei Jikh, and six other creators.
Binance & Voyager pause gets denied by judge as he says any “delay would harm customers.” A US Attorney had previously argued the $1B deal should be stopped because it seeks to absolve Voyager of tax & securities law violations.
Earnings Reports 💰
Follow our Twitter account for real-time breakdowns of earnings reports.
GitLab ($GTLB) - Report
Revenue: $123m vs $120m expected and $78m year ago (+58% YoY)
EPS: -$0.03 vs -$0.14 expected and -$0.16 year ago (+81% YoY)
Metrics:
Customers >$5K ARR: 7,002 (+52% YoY)
Customers >$100K ARR: 697 (+42% YoY)
Customers >$1M ARR: 63 (+62% YoY)
Guidance:
Q1 revenue $117m to $118m ($126M est.)
FY revenue $529m to $533m ($586m est.)
Market Reaction: -23.8%
—
Adobe ($ADBE) - Report
Revenue: $4.66B vs $4.62B expected and $4.26B year ago (+9% YoY)
EPS: $3.80 vs $3.68 expected and $3.37 year ago (+13% YoY)
Metrics:
Digital Media Revenue: $3.4B (+9% YoY)
Remaining Perf. Obligations: $15.2B (+10% YoY)
Operating Cash Flow: $1.7B (-4% YoY)
Guidance:
Q1 Non-GAAP EPS of $3.75 - $3.80 on sales of $4.75B - $4.78B (+9% YoY)
FY Non-GAAP EPS of $15.30 - $15.60
Market Reaction: +5.7%
—
Other Reports
Week Ahead 📅
Monday
Germany - PPI Inflation (FEB)🇩🇪
Tuesday
US - Existing Home Sales (FEB)🇺🇸
Canada - CPI Inflation (FEB)🇨🇦
Germany - ZEW Economic Sentiment (MAR)🇩🇪
Earnings Reports: Nike💰
Wednesday
US - Fed Funds Rate Decision🇺🇸
UK - CPI Inflation (FEB)🇬🇧
Earnings Reports: Tencent, Chewy, Signify Health💰
Thursday
US - Jobless Claims🇺🇸
UK - BoE Interest Rate Decision🇬🇧
Japan - CPI Inflation (FEB)🇯🇵
Earnings Reports: Accenture, FactSet, General Mills💰
Friday
US - Durable Goods Orders (FEB)🇺🇸
UK - Retail Sales (FEB)🇬🇧
Europe - S&P Manufacturing PMI (FEB)🇪🇺
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