The Rundown - Lyft Soars on Upbeat Guidance, Match Group Earnings Give Investors the Ick

Episode Date: November 7, 2024

Stock market update for November 7, 2024.

Public.com presents the rundown, your daily market update in five minutes. My name is Zaid Madh, and today is Thursday, November 7th. In today's episode, we recap a historic day in the markets and tell you why some bond investors are kind of nervous. You also recap earnings from Lyft, Warner Brothers, Qualcomm, and more. And stick around to the end of the show to find out how much money Elon must spent on Trump's campaign and why the bet looks to have paid off big time so far. All right. Let's go.

Ooh, big day for the markets yesterday. We saw green across the board. Both the S&P and NASDAQ had their best day of the year jumping more than 2.5%. And according to Bloomberg, this was the best post-election day performance by the S&P 500 in history. The Dow also had a historic day adding 1,500 points, which is the best day in four years, also hitting record highs in the process. But I still don't care about the Dow. Oh, and I should mention small cap stocks had a monster day. The Russell 2000 was up nearly 6%. So like I said, we saw green across the board.

Obviously, this is a pretty strong reaction by the markets to Trump winning the election and the Trump trade going into full effect here. Investors are anticipating lower corporate taxes and looser regulations. We talked more about Trump's potential policies and why the markets are reacting so strongly in yesterday's episode. So go check that out if you missed it. I want to talk about the bond market real quick. I don't typically talk about bonds on the rundown, but the bond market's reaction to the election. was pretty interesting. Bon investors didn't react as positively. The 10-year treasury yield jumped yesterday to the highest level since July. And remember, the 10-year treasury rate impacts things like mortgage rates, car loans, credit card rates, so it does have an impact on the economy. And the fact that it went up after Trump won could be a sign that bond investors think that Trump's policies will lead to increase government deficits and higher inflation. So that's something to keep an eye on. And speaking of

inflation. Don't forget, we have a Fed meeting today. And you know, I feel like this might be the least anticipated Fed meeting of the year. It's pretty much guaranteed that the Fed will cut interest rates by 25 basis points today. So there's no mystery going into this meeting. But I am interested to know what Jerome Powell says in his press conference. And just trying to get Jay Powell's vibe about the economy and his thoughts on the election. I'm sure we'll get a lot of questions from reporters about Trump. So I'll be tuning in for that. The press conference starts at 2 p.m. Eastern. But, you know, if you can't watch it, don't worry. I'll recap the best parts for your. you on tomorrow's episode of The Rundown, so just subscribe to the pod and tune in tomorrow.

Let's run through some headlines. And let's shift the conversation back to earnings because we are in the middle of earnings season and a ton of companies have reported earnings this week. Let's start with Lyft. Their stock is soaring after they reported solid earnings and boosted their guidance moving forward. Lyft's gross bookings grew by 16% and their riders increased by 9% to over 24 million. Now, this was very interesting.

Lyft also announced a new deal to host self-driving cars on its platform via a partnership with MobileEye. I think that's something that you're going to see more of these right-hailing companies do. Uber's already been cutting deals to get self-driving cars on its app with a partnership with Google's self-driving unit Waymo and General Motors self-driving company Cruise. So now Lyft is jumping in on the self-driving trend as well. I do wonder how the new era of self-driving taxis is going to change the economics of Uber and Lyft.

Now, I don't think we're fully there yet, but, you know, it's becoming more and more promising. I'm just hoping for cheaper rides because, you know, having to pay $60 to go three and a half miles during a surge period. That's not fun. But yeah, investors are very hyped about Lyft. Their shares are up 24% on this news in reaction to these earnings. Let's talk Warner Bros. Discovery. They just reported earnings. And they added 7 million new subscribers to its max streaming service.

Not bad. They now have over a total of 110 million subscribers worldwide. That 7 million new subscribers is pretty great. Just to put some context on that, Netflix added 5 million new subs last quarter, and Peacog added just 3 million. So Warner Brothers added more subscribers than all of them. According to CNBC, Max's international expansion strategy was a key reason for the recent growth. It looks like HBO fans are enjoying the new Penguin show. I've heard a lot of great things about it.

I haven't watched it myself, but I'll have to check it out probably during the holidays. And Dune fans should be hyped as well because there's a new spin-off series for Dune called Prophecy coming on November 17th. So yeah, HBO pumping out some great content, and it's leading to more subs. I know I said the word HBO a few times, but the streaming service is called Just Max. Remember, they dropped the HBO name, which I still think is pretty dumb. That's long gone at this point. Now, zooming out from Just the Streaming Service, Warner Brothers did report lower than expected sales in the quarter. The company's cable unit, eh, not doing so good.

Not surprising there who watches cable these days. Their movie studio also not doing so good. That revenue dropped 17%. But also, that number is comparing it to the same quarter last year, which is when Barbie came out. and went on to become a box office phenomenon and Warner Brothers' highest grossing movie ever. So kind of a tough comparison. So yeah, Warner Brothers business outside of the streaming division, not doing so good. Investors seem to be somewhat optimistic, though. Warner's stock is up around 5% this morning in reaction to these earnings. Let's talk about some stocks making moves today.

And we're talking more earnings, baby. Let's start with Qualcomm. Their shares are up this morning after the chip company reported earnings and pulled off the earnings trifecta. They beat on revenue, they beat on profit, and provided a strong guidance. Now, smartphone chips still make up Qualcomm's core business. They make chips for Android phones that you might have heard of, like the Snapdragon chip, which is very popular. But Qualcomm also sells 5G modems to Apple for their iPhone. Qualcomm's core business jumped by 12% this past quarter. Qualcomm's also trying to diversify their business as well. Their automobile chip segment grew by 81%. And now Qualcomm is making chips designed for laptops, specifically for AI. Their Snapdragon X series came out earlier this year,

and it's gotten some pretty decent reviews from what I've seen. Investors seem to be loving these results from Qualcomm, and the stock is up 5% in reaction to these earnings. Now, on the flip side, there are a couple of companies that are struggling this morning. Match Group shares are tumbling after they reported a lower than expected revenue outlook for Q4. Match Group owns a ton of dating apps, including Tinder and Hinge. They reported that Tinder's monthly active users were down 9% year over year. And that's making investors pretty concerned.

Now, Matt says they're working on improving the platform to remove like the hookup app label that Tinder has gotten now. Yeah, I'm not sure how they're going to pull that. that off. Now, Hinge, on the other hand, is doing much better. Their monthly active users grew by 20%. That still wasn't good enough for investors. Match Group shares are down more than 14% this morning in reaction to these earnings. Now, another popular app with young people is struggling this morning. Duolingo shares are down after the language learning app missed on paid subscriber expectations. Duolingo reported 8.6 million paid subs in the quarter compared to the estimates calling for

8.66. I mean, it was a slight miss. Duolingo did beat on revenue and earnings for the quarter, that subscriber miss was enough to spook investors and shares are down 5% in reaction to these earnings. Man, they missed by less than 1%. Let's wrap the show with a fun fact. Elon Musk spent over $130 million on Trump's campaign, according to some estimates. And that bet looks to have paid off pretty well. Tesla stock was one of the big winners yesterday, jumping 14% increasing Elon's net worth by around $20 billion. On top of that, Elon being boys with Trump might help with his other company, SpaceX,

which is occasionally run into some issues with regulators. Obviously, it's only been a couple days, but the early ROI for Elon's bet on Trump seems to be paying off big time. All right, guys, that's the rundown for today. It has been a very memorable week, action-packed, a ton of stuff happening, and we still have the Fed meeting happening today. So we're not done yet. If you guys enjoyed these episodes,

consider giving us a five-star rating on Apple and Spotify. Leave a comment on Spotify, vote in the Spotify polls. All that engagement really does help us out. Thank you guys again for listening. And shout out to Mike and Connor for all the help behind the scenes. And we'll see you guys back here tomorrow. This is the rundown, your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests.

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