The daily business briefing: April 4, 2022
Musk takes a big stake in Twitter and shares soar, Lithuania cuts off gas imports from Russia, and more
Musk takes stake in Twitter, shares soar
Twitter shares jumped by 26 percent in pre-market trading on Monday on the news that Tesla CEO Elon Musk had acquired a 9.2 percent stake in the social media company. Musk now owns 73,486,938 shares of Twitter, according to a regulatory filing with the Securities and Exchange Commission. At Friday's closing price, Musk's stake was worth $2.89 billion. Musk's stake is classified as passive, but some investors are betting it could lead to big changes. Musk is a frequent Twitter user, and a week ago he hinted about shaking up the company. "Musk could try to take a more aggressive stance here on Twitter," Wedbush analyst Dan Ives said Monday on CNBC's Squawk Box.
Lithuania ends gas imports from Russia
Lithuania said over the weekend it had cut off Russian gas imports, which would make it the first country in the 27-member European Union to do so. "Seeking full energy independence from Russian gas, in response to Russia's energy blackmail in Europe and the war in Ukraine, Lithuania has completely abandoned Russian gas," Lithuania's energy ministry said in a statement. The policy took effect at the start of April. On Saturday, Lithuania got its imports of Russian gas down to zero. In 2015, Lithuania got nearly all of its natural gas from Russia, but it has been drastically reducing its purchases from that country since starting operations at an off-shore LNG import terminal in the port city of Klaipeda in 2014.
Starbucks pauses buybacks to invest in cafes, employees
Starbucks said Sunday it was suspending stock buybacks it started last fall, which interim Chief Executive Officer Howard Schultz said would give the company money to invest in its cafes and workers. "We all have a stake in our future," Schultz wrote in a letter to employees as he returns as the coffee giant's CEO on Monday. "This serves as an invitation to come build it." Schultz built the coffee chain over several decades, and he is returning to run it following Kevin Johnson's announcement in March that he was stepping down as CEO, a job he had held since 2017. Schultz said he plans to reinvigorate the company as it contends with rising costs and increasing unionization of U.S. baristas.
Airlines cancel thousands of flights
Airlines canceled more than 3,400 flights and delayed 8,800 on Saturday and Sunday due to Florida storms and technology problems at Southwest Airlines, according to flight tracker FlightAware. Southwest canceled 520 flights on Saturday — about 14 percent of its operations — and another 398 on Sunday. Southwest, the nation's largest domestic carrier, has said up to 50 percent of its flights travel over Florida. Budget airline Spirit, which has its biggest hub in Fort Lauderdale, lost a larger chunk of its schedule than any other carrier, canceling 27 percent of its flights on both Saturday and Sunday, FlightAware said. JetBlue canceled 25 percent of its Sunday flights, up from 15 percent on Saturday.
U.S. stocks rise after starting April with gains
U.S. stock futures rose slightly early Monday. S&P 500 and Nasdaq futures were up by 0.1 percent and 0.4 percent, respectively, at 7 a.m. ET. Futures tied to the Dow Jones Industrial Average were essentially flat. The S&P 500 is coming off its third straight week of gains. All three of the main U.S. indexes rose on Friday, starting April on a positive note after the Labor Department reported that U.S. employers added 431,000 jobs in March, falling short of the 490,000 economists surveyed by Dow Jones expected but still indicating strong hiring. "Strong gains on the employment front continue to signal a green light for investors" despite high inflation and concerns over interest rate hikes, said Peter Essele, head of portfolio management for Commonwealth Financial Network.