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Good morning readers. Taylor Swift is breaking records. Again. Her latest album, "The Tortured Poets Department," dropped on Friday, shattering streaming records across Spotify, Amazon Music, and Apple Music. Swift's 11th studio album amassed a jaw-dropping 300 million streams on Spotify in just one day, making it the most-streamed album ever within a mere 12 hours. Not stopping there, Amazon and Apple also reported record-breaking numbers. Swift's musical prowess continues to dominate, leaving fans in awe and streaming platforms in her wake.

Let’s jump into today’s storylines.

In today’s digest:

• Big tech faces a touch week ahead

• Headline Hustle: FTC blocks $8.5 billion deal uniting Coach and Michael Kors, UK passes controversial bill sending asylum seekers back to Rwanda, hackers stole health data on ‘a large proportion of Americans’ in UnitedHealth hack

• Food prices might be on the decline in 2024

• Pulse Points: What’s Trending

TECH

Tech giants walk a tightrope of turmoil as earnings season kicks off

Tech giants are heading into this earnings season with their best impression of Steve Urkel’s “did I do that?”. And it has investors concerned. Google is dealing with protests and layoffs, Tesla's doing mass layoffs and recalls, and Meta's AI rollout could use a few more lines of code.

It’s no wonder Wall Street’s getting jittery. The tech-heavy Nasdaq Composite took a nosedive last week, dropping 5.5%—the biggest weekly slump since November 2022. Even AI darling Nvidia plunged 14%, showing that when Big Tech sneezes, the market catches a cold.

Here are a few things that have investors concerned heading into earnings…

Tesla's stock has seen better days.

• After a rough quarter, it's about to report its first year-over-year revenue decline since 2020.

• The electric vehicle maker's struggles include bruising delivery numbers, price cuts, and even a voluntary recall of over 3,800 Cybertrucks due to a "stuck pedal" issue. The company also laid off 10% of its global workforce.

Meta's stock may have surged this year, but it's not without its issues.

• The Reality Labs division, responsible for Zuckerberg's metaverse vision, is expected to report another massive quarterly loss—over $4 billion.

• And Meta’s AI debut was a little too human for comfort. Its new AI assistant caused a stir by joining Facebook groups and pretending to be a real person, creating a PR mess for the company.

Then there’s Google and Microsoft.

• Google is restructuring its finance department, laying off staff, and consolidating AI teams under Google DeepMind. Not the best look for a company dealing with slower growth and growing employee discontent.

• Microsoft, on the other hand, narrowly avoided a European Union antitrust probe into its relationship with OpenAI, its AI partner. The company has invested billions into OpenAI and other AI startups, betting big on the generative AI boom. But with the stock trailing its peers this year, even Microsoft's AI-driven ascent to a $3 trillion market cap might not be enough to keep the analysts happy.

Big picture: In a week that’s as much about numbers as it is about narratives, Wall Street braces for impacts that could resonate well beyond quarterly charts.

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IN THE KNOW

Headline Hustle

🛍️ FTC blocks $8.5 billion deal uniting Coach, Michael Kors. The U.S. Federal Trade Commission has taken legal action to halt the $8.5 billion acquisition of Capri Holdings by Tapestry, the parent company of Coach and Kate Spade. The move interrupts a significant consolidation in American luxury retail, combining renowned brands like Coach and Michael Kors under one umbrella. While Tapestry aims to enhance its competitive position in the global luxury market, regulators argue the merger could limit consumer choices and impact employee welfare. Both companies vow to contest the lawsuit, highlighting evolving consumer behavior and market dynamics.

🇬🇧 UK passes controversial bill sending asylum seekers back to Rwanda. The UK parliament has approved a controversial bill allowing the government to send asylum seekers to Rwanda for their claims to be assessed, despite previous legal setbacks and opposition. Prime Minister Rishi Sunak's initiative aims to curb irregular migration, particularly via sea crossings, but has faced scrutiny over human rights concerns and its efficacy. Despite the bill's passage, legal challenges may arise, and its long-term impact on migration remains uncertain amid ongoing political and legal debates.

❤️‍🩹 UnitedHealth confirms hackers stole health data on ‘a substantial proportion of people in America’ . UnitedHealth Group has confirmed a ransomware attack on its subsidiary Change Healthcare earlier this year resulted in a significant theft of Americans' private healthcare data. The attack, attributed to the RansomHub gang, compromised personal and protected health information, potentially affecting a substantial portion of the U.S. population. While UnitedHealth stated it hadn't yet observed theft of full medical histories, the breach raises concerns over data security and patient privacy.

FOOD

Is your grocery bill finally getting a break?

Just when you thought your wallet couldn't take another hit at the checkout line, there's a glimmer of hope on the horizon. According to Oxford Economics, 2024 might just be the year we all get a little relief from those sky-high food prices.

The supply side story

Global food prices are poised to dip this year, giving both your pantry and your budget a bit of breathing room. The forecasted drop is largely thanks to bumper crops of wheat and maize, which are seeing a significant rise in production after the price spike following the onset of the Russia-Ukraine conflict in 2022. This agricultural bounty has led to a decrease in commodity prices, with wheat futures down nearly 10% year-to-date and maize futures shedding about 6%.

While we're witnessing a welcome downturn in wheat and maize, rice tells a different story. Facing export restrictions from India— a major player in the global rice market— and less-than-stellar harvests, rice prices have stubbornly climbed, ticking up over 8% since the start of the year.

But it's not all sunshine and falling prices. Oxford Economics notes that risks to food prices are still “overwhelmingly skewed to the upside,” with adverse weather conditions a significant factor. Bad weather is denting the confidence of agribusinesses, and if these conditions persist, it could affect other key crop regions.

Looking ahead…Oxford Economics expects food prices to bottom out this year before slowly climbing again in the latter half of 2024. So, while the forecast offers a glimpse of relief, savvy shoppers should keep an eye on the skies—and their budgets.

SNIPPETS

Pulse Points

• Former President Donald Trump is set to receive an "earnout" bonus of 36 million shares of Trump Media, valued over $1.25 billion based on Monday's price.

• The Supreme Court appeared to side with cities to allow them to enforce laws on homeless encampments, with conservative justices questioning lower-court rulings that deemed such restrictions as unconstitutional for inflicting cruel and unusual punishment.

• Fashion retailer Express Inc. has filed for bankruptcy due to ongoing challenges with its merchandise mix that failed to attract shoppers.

• Officials began construction on a new high-speed rail system on Monday, aiming to connect Southern California with Las Vegas.

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