Alaska Airlines N704AL, a 737 Max 9, which made an emergency landing at Portland International Airport on January 5 is parked at a maintenance hanger in Portland, Oregon on January 23, 2024.
- Tesla stock took a dive.
- Alaska Airlines said it will lose $150 million because of the Boeing grounding.
- Investors will be watching the fourth-quarter GDP report.
Here are the most important news items that investors need to start their trading day:
1. Ups and downs
The Nasdaq Composite and the S&P 500 each rose for the fifth day in a row Wednesday. The S&P increased by a minuscule 0.08% but was still able to secure a new all-time closing record. The Nasdaq was led by a broader tech rally and finished the day 0.36% higher. The Dow missed out on the day's rally and was dragged down by declines of more than 2% in Verizon and 3M, which each reported earnings on Tuesday. Netflix, meanwhile, soared after its Tuesday earnings report and finished the day with gains of more than 10%. Follow live market updates.
2. Between waves
Tesla stock fell 8% in premarket trading after reporting fourth-quarter revenue and profit that missed analysts' estimates. The electric vehicle company also warned that vehicle volume growth in 2024 "may be notably lower" than last year's growth rate. Automotive revenue, meanwhile, increased just 1% from a year earlier, partly because the EVs were selling for less than they had in the past. Tesla implemented steep price cuts in the second half of the year around the world. In a Wednesday presentation, the company warned investors that it's "currently between two major growth waves."
3. Better than expected
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The U.S. economy increased at a much more rapid pace than expected in the fourth quarter. Gross domestic product, which measures all the goods and services produced in the country, grew at a 3.3% annualized rate in the last three months of 2023, according to data adjusted seasonally and for inflation. The Wall Street consensus estimate had been for 2% growth. Consumer spending continued to drive the growth, and state and local government spending also contributed to gains. At the beginning of the year, many economists had been all but certain that the U.S. would go through some kind of shallow recession but the country easily skirted such fears.
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4. Financial fallout
Alaska Airlines said the grounding of Boeing 737 Max 9 planes will cost the company $150 million. The Max 9s were grounded weeks ago after a door plug blew out during an Alaska Airlines flight while the plane was 16,000 feet above the ground, leaving a hole in the side of the aircraft. The airline said Thursday morning in a disclosure that it had been expecting to grow its capacity from 3% to 5% this year, but it now expects the growth to be "at or below the lower end of this range." Alaska Airline's announcement came on the heels of the Federal Aviation Administration late Wednesday clearing a path for the planes to return to service but halting Boeing's plans to increase production of them.
5. Eyes on subscribers
Comcast beat expectations for both revenue and profit in the fourth quarter while losing fewer broadband subscribers than analysts had anticipated. It lost 34,000 domestic broadband subscribers, nearly half of the 62,000 analysts were expecting, according to StreetAccount. The company also raised its dividend 7%, it said Thursday. Comcast has raised its dividend for 16 consecutive years. NBCUniversal's streaming service, Peacock, meanwhile added 3 million subscribers and saw its revenue increased 51% to $1.03 billion. It's the first time Peacock has topped $1 billion or more in a quarter.
Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.
— CNBC's Alex Harring, Lora Kolodny, Jeff Cox, Leslie Josephs and Alex Sherman contributed to this report.
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