The daily business briefing: March 10, 2022
Amazon shares jump overnight after company announces 20-for-1 stock split, stock futures fall after Russia-Ukraine talks, and more
Amazon shares surge after company announces 20-for-1 stock split
Amazon shares jumped 7 percent in after-hours trading after the online retail giant announced that its board had approved a 20-for-1 stock split, and a $10 billion stock buyback. The split, Amazon's first since 1999, doesn't directly affect company value, but an Amazon spokesperson said it would make the stock more accessible to individual investors. Shareholders still must approve the split. The shares closed up by 2.4 percent at $2,785.58 on Wednesday before the announcement. Amazon's split is similar to the one Google parent Alphabet announced last month. Analysts say such splits can make mega-cap tech stocks more palatable as possible components of the price-weighted Dow Jones Industrial Average.
Stock futures fall after Wednesday's big gains
U.S. stock futures fell early Thursday after high-level talks between Russia and Ukraine ended with little progress. Futures tied to the Dow Jones Industrial Average and the S&P 500 were down by about 0.9 percent at 6:45 a.m. ET. Nasdaq futures were down 1.2 percent. The Dow rose 2 percent on Wednesday. The S&P 500 had its best day since June 2020, rising 2.6 percent. The tech-heavy Nasdaq soared by 3.6 percent, its biggest single-day gain since November 2020. Wednesday's gains came as oil prices, which have surged since Russia invaded Ukraine two weeks ago, fell sharply. U.S. benchmark West Texas Intermediate dropped 12 percent, its sharpest decline since November. International benchmark Brent crude fell 13 percent, the most since April 2020.
Disney CEO says company opposes Florida 'Don't Say Gay' bill
Disney CEO Bob Chapek said Wednesday that the entertainment giant opposes the so-called Don't Say Gay bill just passed by Florida's Republican-controlled legislature. Chapek, who had faced a backlash for not addressing the issue, said at a shareholder meeting that Disney had tried to work with lawmakers "on both sides of the aisle" rather than expressing opposition to the bill, which would bar teachers from discussing sexual orientation or gender identity with students. "We were opposed to the bill from the outset," Chapek said, "but we chose not to take a public position on it because we felt we could be more effective working behind the scenes." Florida is home to the company's Disney World theme park.
Sanctions push Russia to brink of debt default
Russia faces "imminent" risk of defaulting on its debts as Western sanctions imposed over its Ukraine invasion hamper access to the dollars and other currencies it needs to make payments. Fitch Ratings on Wednesday downgraded Russia's credit to "C," or junk status, and warned investors that Moscow was getting perilously close to being unable to make payments to its creditors. The downgrades serve as a warning to investors to stay away to avoid being affected by sanctions, but a likely default would have far broader consequences, making risk-tolerant lenders reluctant to provide the high-risk loans developing international markets depend on. Russian President Vladimir Putin could force lenders in some countries to accept payment in rubles, but that could further devalue the Russian currency.
U.K. imposes sanctions against Russian billionaire Roman Abramovich
The British government on Thursday imposed sanctions against Russian billionaire Roman Abramovich. The U.K. is the first Western country to target Abramovich, but the move is part of a broader effort to increase pressure on Kremlin-linked businessmen since Russia invaded Ukraine two weeks ago. Abramovich, who has a net worth of $12.4 billion, has been trying to sell his soccer club Chelsea FC, as well as his London home. The U.K. government said it was freezing his assets and imposing a travel ban, although it will allow the soccer team to continue operating under a special license. The U.K. already has imposed sanctions targeting other billionaires, including Oleg Deripaska and Igor Sechin.