The daily business briefing: November 11, 2021
Inflation hits highest pace in 31 years, Musk sells nearly $5 billion in Tesla shares, and more
Inflation accelerates to fastest pace in 31 years
Inflation jumped to a 6.2 annual rate in October, the highest in the United States since 1990, the Labor Department reported Wednesday. On a monthly basis, prices rose by 0.9 percent, up from a 0.4 percent increase in September. The October acceleration in the consumer price index came as the pandemic continued to cause supply disruptions and demand remained strong. It was the fifth straight month with the annual pace rising by 5 percent or more. The core price index, which leaves out volatile food and energy costs, rose by 4.6 percent in October compared to a year earlier, the biggest increase since 1991. That was up from a 4 percent annual rise in September.
Musk sells $5 billion worth of Tesla shares
Tesla CEO Elon Musk sold nearly $5 billion worth of shares in the electric car company after a majority of Twitter poll respondents said he should unload 10 percent of his stake in the company. Musk exercised options on 2.1 million shares Monday, then sold nearly half for about $1.1 billion, according to a filing with securities regulators. He sold more on Tuesday and Wednesday, raising another $3.8 billion. The sale was "solely to satisfy [Musk's] tax withholding obligations related to the exercise of stock options," the filing on the first sale said. Investors had known Musk would have to sell stock to cover his $15 billion tax bill, but the company's stock fell after the Twitter poll because 10 percent was more than many expected.
Biden to sign infrastructure bill on Monday
President Biden will sign the more than $1 trillion bipartisan infrastructure bill on Monday, the White House announced Wednesday. The legislation amounts to the biggest federal investment in upgrading the nation's roads, bridges, ports, and other infrastructure in "generations," the White House said. Members of Congress who crafted the bill will join Biden for the signing ceremony. "The President will highlight how he is following through on his commitment to rebuild the middle class and the historic benefits the Bipartisan Infrastructure Deal will deliver for American families," with the plan providing "millions of good-paying, union jobs for working people" and strengthening supply chains, the White House said in a press release.
Rivian shares soar after huge IPO
Shares of electric-truck startup Rivian soared in its market debut Wednesday. Rivian set its initial public offering price at $78. The stock opened at $106.75, and later traded as high as $112, an increase of 43 percent over the IPO price. The startup's surge gave it a market value of more than $100 billion on a fully diluted basis, vaulting it past Ford, General Motors, and other established automakers. Rivian has attracted investors like Ford and Amazon with its plan to help push EVs into the mainstream with an electric pickup, an SUV, and a delivery van. "The IPO represents an opportunity to accelerate how quickly we can go," said Rivian founder and CEO RJ Scaringe. "We have to go build a lot of vehicles."
Stock futures rise after Wednesday's losses
U.S. stock index futures gained early Thursday after Wednesday's selloff, which was led by tech stocks. Futures tied to the Dow Jones Industrial Average were up by 0.1 percent several hours before the opening bell. Futures for the S&P 500 and the tech-heavy Nasdaq rose by 0.3 percent and 0.6 percent, respectively. Disney shares dropped by more than 4 percent overnight after the entertainment giant reported disappointing quarterly results and Disney+ subscribers fell short of expectations. The Dow and the S&P 500 fell by 0.7 percent and 0.8 percent, respectively, on Wednesday. The Nasdaq dropped by 1.7 percent after a government report showing an inflation jump.