Morning Brief: Tesla to cut workforce by 7%, shares fall

Updated January 18, 2019 at 6:18 AM

Friday, January 18, 2019

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WHAT TO WATCH

Investors will get a peek into the U.S. consumer’s outlook on the economy. The University of Michigan will be releasing its index reading for the month of January. Economists polled by Bloomberg are expecting a reading of 96.4, down from 98.3 in December.

Furthermore, as the first week of earnings season draws to a close, rail company Kansas City Southern (KSU), oil services giant Schlumberger (SLB), and State Street (STT) will release earnings before the bell.

Analysts polled by Bloomberg are estimating that Kansas City Southern will report earnings of $1.53 per share on $685.2 million in revenue, and earnings of 38 cents per share on $8.04 billion in revenue for Schlumberger. State Street is expected to have earned $1.67 per share on $2.96 billion in revenue during Q4.

A sales staff chats with a customer at a Tesla store near a poster announcing orders of the Model 3 electric cars in Beijing, China, Monday, Jan. 7, 2019. Tesla Motors CEO Elon Musk said Monday on Twitter that the automaker is breaking ground for a Shanghai factory and will start production of its Model 3 by the end of the year. (AP Photo/Ng Han Guan) — A sales staff chats with a customer at a Tesla store near a poster announcing orders of the Model 3 electric cars in Beijing, China. (AP Photo/Ng Han Guan)

Tesla to cut full-time workforce by 7%: Tesla Inc. (TSLA) on Friday said it will cut its full-time workforce by about 7%, while it ramps up production of its Model 3 sedan.Tesla shares fell 4.1% in pre-market trading. [Reuters]

U.S. weighs lifting trade tariffs against China: U.S. officials are debating ratcheting back tariffs on Chinese imports as a way to calm markets and give Beijing an incentive to make deeper concessions in a trade battle that has rattled global economies. [The Wall Street Journal]

Netflix revenue disappoints, shares dip: Netflix (NFLX) posted revenue of $4.19 billion, falling short of estimates of $4.21 billion for the quarter. The disappointing fourth-quarter revenue announcement comes on the heels of the company’s recent move to raise prices for the fourth time in its 12-year history. [Yahoo Finance]

Trump cancels U.S. delegation to Davos forum: President Donald Trump has canceled his delegation's trip to the World Economic Forum in Davos, Switzerland, next week due to the partial U.S. government shutdown, according to a statement released by Press Secretary Sarah Sanders on Thursday. [Reuters]

Alibaba to postpone some hiring, cut travel spending: Alibaba Group Holding Ltd. (BABA) is cutting its spending on travel and postponing some new hiring as China’s largest e-commerce company braces for a slowing economy, people familiar with the matter said. Some new hires were told they can’t start until the new fiscal year begins in April, the people said. [Bloomberg]