Here are the most important news, trends and analysis that investors need to start their trading day:
- Wall Street looks like it's going to extend its losing streak
- Netflix's plunge would erase gains back to April 2020
- Peloton is taking 'significant corrective actions,' CEO says
- Intel plans to build a $20 billion chip manufacturing site in Ohio
- U.S., Russia far apart on Ukraine crisis as top diplomats meet
1. Wall Street looks like it's going to extend its losing streak
U.S. stock futures dropped Friday, with the Nasdaq again tracking for the biggest decline at Wall Street's open as Netflix shares plunged in the premarket on slowing subscriber growth. The Nasdaq fell for a third straight session, ending Thursday nearly 12% below its latest record close in November. The S&P 500 also dropped for three days in a row, finishing 6.5% under its record close earlier this month. The Dow Jones Industrial Average fell for five straight sessions, ending more than 5.6% below its early January record close. All three stock benchmarks were on pace for big weekly losses.
- The 10-year Treasury yield's dip below 1.8% on Friday did little to help beaten-up tech stocks.
- Cryptocurrencies, which have followed the ups and downs in the tech sector, sank Friday. Bitcoin and ether fell 9% and nearly 11%, respectively.
2. Netflix's plunge would erase gains back to April 2020
Shares of Netflix fell 20% in Friday's premarket, indicating an opening price of below $410 each, wiping out more than 20 months of gains and over 40% below its all-time high back in November. Investors punished the stock following Thursday's after-the-bell earnings report, which revealed a decline in global paid net subscriber additions in the fourth quarter and an even worse projection for the current first quarter.
- The video streaming giant beat Q4 earnings estimates and matched on revenue, but Wall Street was more concerned about what's ahead.
- Netflix said it's planning for a more back-end-weighted content slate in the first quarter, with big premieres set for March.
3. Peloton is taking 'significant corrective actions,' CEO says
Peloton said late Thursday its fiscal second-quarter revenue will be within its previously forecast range, as it takes actions to slash costs and improve profitability. However, the fitness equipment maker said it added fewer subscribers in the latest period, which ended Dec. 31, than it had previously expected.
The stock bounced 8% in Friday's premarket, the morning after an almost 24% decline in the regular session following a CNBC report that the connected fitness equipment maker was temporarily halting production of its stationary bikes and treadmills as explosive demand earlier in the Covid pandemic waned. Friday's indicated opening price for Peloton stock would represent an 85% drop from its all-time high of $171.09 back in January 2021.
4. Intel plans to build a $20 billion chip manufacturing site in Ohio
Intel will invest $20 billion in two new plants in Ohio to make advanced chips, the company said Friday, the first step to a "mega-site" that can accommodate eight chip factories costing $100 billion. The planned investment includes 3,000 permanent jobs and 7,000 construction jobs on the 1,000-acre site just outside of Columbus. Intel CEO Pat Gelsinger is driving Intel's plans to expand, especially in Europe and the U.S., as it seeks to heat up competition with global rivals and respond to a worldwide microchip shortage. In September, Intel broke ground on two factories in Arizona as part of its turnaround plan to become a major manufacturer of chips for outside customers.
5. U.S., Russia far apart on Ukraine crisis as top diplomats meet
The U.S. and Russia are trying to avoid another conflict in Europe. However, the top diplomats from both nations warned Friday that no breakthrough was imminent as fears rise that Moscow is planning to invade Ukraine. U.S. Secretary of State Antony Blinken and Russian Foreign Minister Sergey Lavrov met in Geneva at what the American said was a "critical moment." Lavrov called the talks "constructive and useful." Moscow wants a promise that Ukraine, a former Soviet republic, will never be allowed to join NATO and it's calling for the removal of allied troops and military equipment from parts of Eastern Europe. The U.S. and NATO have rejected those demands. In 2014, Russia seized control of Ukraine's Crimean Peninsula.