The daily business briefing: February 23, 2022
The S&P 500 falls into correction territory but futures rebound, U.S. women's soccer team players win equal-pay settlement, and more
S&P 500 falls into correction territory
The S&P 500 on Tuesday fell into correction territory, defined as 10 percent below its recent high, as Russia recognized two breakaway regions in Ukraine and sent in troops as "peacekeepers," escalating the Ukraine crisis. The S&P dropped 1 percent to close at its lowest level in four months. It had been down 2 percent earlier in the day, but rebounded some after President Biden called Putin's moves an "invasion" and announced new sanctions against Russia. The Dow Jones Industrial Average closed the day down 1.4 percent. The tech-heavy Nasdaq Composite fell 1.2 percent. The Dow is now 8.7 percent below its January record, and the Nasdaq has fallen 17 percent from its November peak. Stock futures rebounded early Wednesday, with those tied to the S&P 500 up 0.6 percent at 6:30 a.m. ET.
Women's team players reach equal-pay settlement with U.S. soccer
The United States Soccer Federation has agreed to pay members of the U.S. women's national team $24 million to settle the players' equal-pay lawsuit, the opposing sides of the six-year legal battle announced in a Tuesday court filing. Under the settlement, the players will get a lump sum payment of $22 million plus another $2 million to be deposited into an account supporting retired players and their efforts to promote women's and girls' soccer. Each player can apply for up to $50,000 from the fund. The court must approve the final settlement once the federation and the team members reach a new collective bargaining agreement. The USSF has committed to equal pay rates for members of the women's and men's national teams. "This will fully resolve the litigation," the players said in a statement.
Home Depot shares drop as outlook dims despite strong earnings
Home Depot shares plunged 9.8 percent on Tuesday afternoon, accounting for about 223 points of the Dow Jones Industrial Average's 580-point decline. The losses came after Home Depot reported better-than-expected quarterly earnings and raised its dividend, but provided a disappointing profit outlook. Home Depot was the Dow's best performer in 2021. It gained more than 55 percent last year as customers increased spending on home upgrades while the housing market soared. But the company's shares have struggled this year, falling 24 percent as investors brace for the Federal Reserve to start raising interest rates to fight high inflation, pushing up mortgage rates and potentially triggering a housing slowdown. Rival home-improvement giant Lowe's reported strong sales and its shares rose 2 percent in pre-market trading.
Trump-linked Digital World's stock surges after Truth Social launch
Shares of Digital World Acquisition Corp, the blank-check company behind former President Donald Trump's new social media platform Truth Social, jumped 14 percent on Tuesday in the first day of trading following Sunday's launch on Apple's App Store. Truth Social topped the App Store's downloads, with 170,000 and counting since launch, research firm Apptopia said. Truth Social gives Trump a way to return to social media after he was banned by Twitter, Facebook, and Google for violating policies against inciting violence after a mob of his supporters attacked the Capitol on Jan. 6, 2021, in a failed attempt to overturn Trump's election loss, which he falsely blamed on voter fraud.
Stellantis reports strong profit in sign of auto industry recovery
Automaker Stellantis on Wednesday reported a profit of $15.1 billion in the first year after it was formed by the combination of Fiat Chrysler and Peugeot maker PSA Group. The reported profits represent a 179 percent yearly increase compared to its predecessors' combined results in 2020, when they faced ongoing supply-chain disruptions due to the pandemic. Stellantis shares rose 5 percent in early trading. The company, which makes the Jeep and Dodge brands, said it expected auto sales to rise 3 percent in North America and Europe, reinforcing signs that carmakers are regaining strength after two years of setbacks during the coronavirus pandemics. Stellantis said its projections assumed no more significant fallout from COVID-19.