The Rundown - Tesla Rallies on Self-Driving News, Biden to Block Acquisition of U.S. Steel

Episode Date: September 5, 2024

Stock market update for September 5, 2024.

Public.com presents the rundown, your daily market update in five minutes. My name is Zaid Madi, and today is Thursday, September 5th. In today's episode, we previewed tomorrow's big job support that has investors on edge. We also tell you why President Biden is blocking the takeover of U.S. Steel. Then we look at some interesting data from Disney's leaked documents and update you on NVIDIA's subpoena from the DOJ. Then stick around to the end of this show to find out the most valuable NFL franchise. even though the team hasn't had much success.

All right, let's go. Stocks continued to move lower in September, a very up and down kind of day for the markets yesterday. Markets were seesawing back and forth, but ultimately the S&P and NASDAQ both finished in the red. The S&P was down 0.2% and the NASDAQ was down 0.3%, so not that bad compared to how things started off on Tuesday, but there seems to be concerns about a softening labor market right now,

so investors are probably waiting for the Friday jobs report to drop, before making any big moves. I mentioned the job support in yesterday's episode. It's a big deal because that report will tell us how many jobs were added in the U.S. economy last month. Forecaster calling for 161,000 jobs added in August, which would be up from the 114,000 jobs added in July. If that number comes in higher than 161,

I think it'll be a sigh of relief for investors and markets could rally. But if that report shows weak job growth, then you probably don't want to check your portfolio on a Friday and ruin your weekend. Job support comes out Friday morning right around the time we record this show. So make sure you listen to tomorrow's episode for an instant live reaction to the report. And a bit of breaking news, we just got another set of jobs data.

The ADP reported that private payrolls in August grew by just 99,000, which is well below the 140,000 that was expected. ADP says this is the smallest gain since January of 2021. So that's not great. The data also follows a new report from the outplacement firm Challenger Gray and Christmas that says that this was the worst August for layoffs in 15 years. So yeah, a lot writing on tomorrow's jobs report. Let's run through some headlines. President Biden is expected to block the takeover of U.S. Steel by a Japanese company. The Japanese steelmaker Napan Steel made a $14.9 billion takeover bid for U.S. Steel back in December of last year, but the president is expected to reject this deal citing national security concerns. The deal, the deal,

is subject to review by the committee on foreign investments in the United States. And that gives the president the power to kill this deal. And this is a sentiment that's shared across the aisle. Donald Trump also vowed to kill this deal if he was elected president. And Vice President Kamala Harris said on the campaign trail on Monday that U.S. Steel should remain American-owned and American-operated. Along with that, the steel workers union has expressed their objections to this deal, citing concerns about national security and possible layoffs.

So this deal doesn't have a great shot of going through at this point. Now, U.S. Steel CEOs said when, If the deal does fall through, the company would be forced to close steel mills and likely move its headquarters out of Pittsburgh. That's where the company was formed back in 1901 by J.P. Morgan, Andrew Carnegie, and Charles Schwab. U.S. Steel is an iconic American company. At one point, it was the most valuable company in the world. But these days, the company struggling, the market cap is around $6 billion.

So we'll see what happens. U.S. steel stock did drop nearly 20% in response to this news. Let's talk about another iconic American company, Disney. financial data was hacked earlier this summer. It didn't get a lot of buzz, but a ton of data was leaked online by hackers, and the Wall Street Journal went through some of those leaked documents. And they found some pretty interesting stuff regarding Disney's business. Like the fact that Disney made over $724 million in revenue from Jeannie Plus between October 2021 and June 2024. Geneal Plus is Disney's premium park pass that was launched back in 2021. For those of you

guys that have been to a Disney park, you guys know what I'm talking about. You have to pay extra for on top of the already expensive tickets, and it gives you perks like access to lightning lanes and some other stuff. Disney fans complained about it, but it seems like a lot of people bought it. We also got some insight on Disney's streaming service Disney Plus. It brought in $2.4 billion in revenue for the March quarter. Disney doesn't typically break down revenues for its individual streaming services,

so it's good to get some color on that. Just as a comparison, Netflix brought in $9.3 billion in the March quarter. So Disney Plus still has a long way to go to catch up to Netflix when it comes to revenue. And the overall direct-to-consumer streaming business generated north of $6 billion in Q2. So that means that Disney Plus makes up around 40% of the overall unit's total sales. And a real quick update from yesterday's episode. We mentioned on yesterday's show that Bloomberg reported that the DOJ has subpoenaed NVIDIA to investigate antitrust violations. Well, Nvidia is denying that claim, saying that they weren't technically subpoenaed, but they

did admit that they were contacted by the DOJ. Bloomberg followed up the report saying that NVIDIA received what's called a civil investigate demand, which is commonly referred to as a subpoena. So at the end of the day, whether it's technically a subpoena or not, NVIDIA is being looked at by the government about potential antitrust violations, but I'm sure this is going to take years to fully sort out. Invitya doesn't seem to be worried about anything. They say they are happy to answer questions from regulators about their business. Let's talk about some stocks making moves today. Tesla is having a nice start to the month. The stock, was the best performing stock in the S&P 500 on Wednesday,

and it's extending its gains in the pre-market today. Tesla announced that they plan to launch full self-driving in China and Europe by the first quarter of 2025. And remember, Tesla also has their Robotaxy event coming up, which is scheduled for October 2nd. So we'll see if Tesla can live up to the hype there. Right now, though, investors seem pretty optimistic. Tesla's stock is up around 3% in the pre-market.

On the flip side, a stock not doing so good this morning, is Frontier Communications, shares are fault. after Verizon announced that it would buy the company for $20 billion in an all-cash offer in order to boost their fiber network. The offer would buy shares at $38 and $50 each. Now, with this deal was announced yesterday, Frontier stock jumped around 38%, which put shares in the range of Verizon's buyout offer. But now shares are down more than 9%. I guess investors aren't confident that this deal will actually go through. If the deal doesn't end up going through, Verizon would have to pay Frontier a $590 million breakup fee.

Let's wrap the show with a fun fact. The most valuable NFL team is the Dallas Cowboys. This is according to a new list from CNBC. The Dallas Cowboys are valued at $11 billion, easily making them the most valuable NFL franchise. The LA Rams are a distant second with a valuation of $8 billion. So that's a $3 billion gap between first and second. Now, this entire list is pretty interesting because it just goes to show you that on-field success doesn't translate to a higher valuation.

The Cowboys haven't been to the Super Bowl since the 90s. And the most successful team over the last five years that Kansas City Chiefs are 18th on this list worth $6 billion, even though they've won three Super Bowls in five years. Well, all right, guys, that's the rundown for today. Thank you guys so much for listening. Remember, big show tomorrow. Jobs report comes out Friday morning. I'm going to be recording the show when the report comes out so you'll get a live,

action. So make sure you guys are tuning in tomorrow. And if you guys enjoy the show, don't forget to hit us with a five-star rating on Apple and Spotify. All that engagement really does help us out. Thank you guys so much for listening. 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. You should not take any mention of a publicly traded security as recommendation to buy, sell or hold that security. Run-down guests are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult,

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