Stocks slid Friday after yet another hot inflation report stoked fears that Federal Reserve rate cuts may not arrive until later than anticipated this year.
All three major indexes broke their five-week winning streaks to end the week in the negative. The S&P 500 ended the week lower by 0.42%, while the Dow slipped 0.11%. The Nasdaq tumbled 1.34%
Wall Street now expects the economy to weaken later in the year. Fewer workers quitting jobs, lower retail sales and corporate spending cuts all hint to a slower economy.
The implications of a firm January inflation report are limited for the Fed because officials have already signaled they are likely to hold rates steady at their meeting next month and because they will have three more inflation readings in hand before their April 30-May 1 policy meeting.
Warren Buffett trims stake in Apple
Warren Buffett’s Berkshire Hathaway (BRK.B:NYSE) trimmed its flagship position in Apple (AAPL:NASDAQ) in the fourth quarter.
Berkshire sold about 1% of its Apple shares in the final three months of 2023, leaving it with a 5.9% stake in the iPhone maker worth about $167 billion on Wednesday, according to Dow Jones Market Data.
The Apple position held by Berkshire has grown to an outsize share of its more than $300 billion stock portfolio. Apple shares have soared 367% since the end of 2018, while the S&P 500 has about doubled.
Buffett praised Apple at Berkshire’s annual meeting last year, saying “it just happens to be a better business than any we own”.
Berkshire shares ended the week 2.3% higher, while Apple shares declined by 3.2%.
Goldman Sachs CEO gets pay bump despite bank’s declining profit
Goldman Sachs (GS:NYSE) CEO David Solomon was awarded $31 million in compensation for 2023, up 24% from $25 million in 2022, the company said in a filing on Friday.
The pay bump comes after the bank’s profit fell 24% to $8.52 billion in 2023.
Solomon’s pay comprises a $2 million base salary, unchanged from the previous year, and a bonus of $8.7 million in cash and $20.3 million in performance-linked stock, the bank said.
Among peers on Wall Street, JPMorgan Chase (JPM:NYSE) CEO Jamie Dimon’s compensation climbed 4.3% in 2023, while Morgan Stanley’s (MS:NYSE) former CEO James Gorman earned 17% higher in the same period.
Goldman shares ended the week 0.15% lower.
Robinhood surprises Wall Street with a fourth-quarter profit. Robinhood (HOOD:NASDAQ) benefited from an increase in trading revenue, and crypto trading had its strongest revenue quarter since 2022. The online brokerage posted $30 million in net income in the latest quarter, its highest earnings yet as a public company.
Robinhood has faced a tough stretch since going public in 2021, including a drop in trading and monthly active users following pandemic-era highs. In 2023, Robinhood began offering traditional and Roth individual retirement accounts as it focused on diversifying its business.
Robinhood shares rose 13% on Wednesday, their best one-day performance since 2022. The stock finished the week 19.5% higher.
Strong earnings and typo give Lyft shares a lift
A strong earnings report—and a big typo—gave Lyft (LYFT:NASDAQ) shares a lift.
The ride-hailing company forecast better-than-expected bookings for the current quarter and said it expects to be cash-flow positive in 2024, a big step toward potential profitability. Lyft’s earnings release accidentally added an extra zero to a profitability metric, sending the stock up more than 60% in after-hours trading Tuesday.
An executive corrected the error on a call with analysts later Tuesday, and Chief Executive David Risher took responsibility for the mistake in a CNBC interview Wednesday. He added that he didn’t want the mistake to take away from the company delivering the best financial quarter in its history.
Lyft shares leapt 35% on Wednesday, their best day on record, finishing the week 37% higher.