Wall Street Morning: Cyber ​​Roundup

Cyber ​​​​Roundup

Tesla (NASDAQ: TSLA ) fans and investors alike are eagerly awaiting the automaker’s annual shareholder meeting this afternoon ET, which begins at 5:30 PM ET. The stock price rose ahead of the recent Cyber ​​Roundup event, which will take place at the company’s new Gigafactory in Austin, Texas. In fact, there is a stock (known for its volatility). increased by almost 50% in late May – a few weeks after the meeting was announced – from $620/share to $922/share as of Wednesday’s close. TSLA +1.5% advance sales.

On the menu: At the top of the list, the number of outstanding shares of the company is allowed. It is seeking approval for a second stock split (1-for-3) in two years following the 5-for-1 deal in August 2020 (the stock is up 130% since that date). “We believe the stock split will help restore the market value of our common stock so that our employees have more flexibility in managing their capital,” Tesla said. “The stock split will make our common stock available to our retail shareholders.”

There are a number of other shareholder proposals for voting, including shareholder proxy access, disclosure and diversity efforts, ESG and collective bargaining policies. This year’s Cyber ​​Roundup also marks the end of the brief directorship of Larry Ellison, founder of Oracle ( ORCL ) and friend of Elon Musk. After his departure, Tesla’s board will be reduced to seven members, and two controversial directors – Ira Ehrenpreis and Kathleen Wilson-Thompson – will be up for re-election (concerns about the amount of borrowing against Tesla shares).

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Wearing a cowboy hat: Elon Musk, the techno king who takes the stage to drum up investor enthusiasm, gets the least attention. He is expected to provide more information on production downtime and supply chain costs after repeatedly saying he can sell all the cars that roll off Tesla’s assembly line. The question-and-answer session may also reveal how Tesla will meet its battery needs, more concrete timelines for the Semi and Cybertruck, and whether and how the company is planning for the recession. (3 comments)

BoE

The current rate hike cycle shows no signs of stopping as the Bank of England is poised for its sixth hike since December. This time, the UK central bank is even expected to raise borrowing costs by 50 basis points, or double the previous round of a quarter point. It would also be its biggest hike in 27 years, raising key interest rates from 1.25% to 1.75% – the highest level since the start of the global financial crisis.

Explanation: “We know they are worried about sterling and in that sense they don’t want to be the odd one out by not joining the 50-base club,” said ING economist James Smith.

Meanwhile, the BoE is due to provide more details on how it plans to start selling its £844 billion package of government bonds. Last month, Governor Andrew Bailey said the central bank could withdraw between £50bn and £100bn in a year after more than a decade of economic stimulus. The BoE also stopped short of predicting a technical recession in May’s latest Monetary Policy Report, but changes in language or expectations could change in today’s edition.

Go deeper: Inflation in the UK is now running at a 40-year high of 9.4%, sparking a cost-of-living crisis amid rising food and energy prices. Liz Truss, who is running for the next prime minister of Great Britain, has also questioned the central bank’s track record in dealing with inflation. He promised to set a “clear direction of travel” for monetary policy, as well as a review of the BoE’s mandate, which could lead to greater oversight by members of parliament.

Labor dynamics

Walmart’s (NYSE: WMT ) payroll cuts come a week after it cut its quarterly and full-year guidance. The firm is laying off hundreds of corporate employees in its merchandising, global technology and real estate divisions. Walmart made the move as part of an effort to reposition itself to mark clothing and other items that have been piling up in its stores.

Larger image: Other retailers were also caught off guard as consumers shifted spending this spring away from high-margin goods that have been in demand for much of the pandemic. Shoppers are now keener on staples such as food and toiletries as discretionary spending takes a hit from the current inflationary environment. Target ( TGT ) and Best Buy ( BBY ) also recently cut their forecasts as they try to keep their inventory at the right size for the rest of the year, which could lead to further discounts and lower profits.

“The signal it sends is not a good one,” said Neil Saunders, retail analyst at GlobalData. “This could further damage the economy and consumer confidence.”

Are there cracks in the labor market? Like most economic indicators, this is a mixed bag of segmented data. Companies are slowing the pace of new hires and even eliminating or cutting roles, but hiring is still taking place in areas of growth (the latest jobs report is out tomorrow). In the case of Walmart, the retailer noted that even amid corporate downsizing, the restructuring will create new roles in e-commerce, health and wellness, supply chain services and promotional sales. (6 comments)

The FAA would like feedback

The Federal Aviation Administration has begun reviewing aircraft seat dimensions to assess whether a minimum standard should be established. Note that these minimum seat sizes are not for comfort, but for passenger safety, such as in the case of an emergency evacuation. The public will have 90 days to submit suggestions on the width and length of the seats, as well as “pitch,” which is industry jargon for the space between the rows.

Background: As airlines continued to shrink seat sizes, passenger advocacy groups such as FlyersRights.org petitioned for minimum standards, which were eventually supported by Congress. The FAA was ordered to move forward with the size rules as part of the FAA Reauthorization Act of 2018, but since then things have been delayed (the pandemic didn’t help matters) and the notice was just released for comment by the Feds. Registration.

Although current regulations do not set minimums for seat sizes, they do require planes to be evacuated within 90 seconds. Many people believe that current seats do not accommodate all body types, and there are additional concerns about tightly packed airplanes, especially regarding seat sizes that can vary between carriers. The FAA is also asking for feedback on how the seat dimensions will affect children, people over 60, and people with disabilities.

Explanation: Paul Hudson, president of FlyersRights.org, wrote: “Some airlines continue to cut seats while people continue to increase.” According to our estimates, only 20% of the population can fit in these places. This comfort is beyond the question of even emergency evacuation; There are serious health and safety issues when you’re in cramped conditions for hours at a time.”