The daily business briefing: October 18, 2022
Biden opens student loan forgiveness applications, Microsoft plans to cut nearly 1,000 jobs, and more
Biden opens student loan forgiveness applications
President Biden announced Monday that the application process is new open for his federal student loan forgiveness plan, which could benefit as many as 43 million borrowers. "This is a game changer for millions of Americans ... and it took an incredible amount of effort to get this website done in such a short time," Biden said at the White House. He was joined by Education Secretary Miguel Cardona. Biden unveiled the program in August, saying that individuals making less than $125,000 per year would be eligible to have up to $10,000 in debt canceled, and those receiving Pell Grants could get an additional $10,000 in loan forgiveness. Borrowers have until the end of the year to submit their applications at StudentAid.gov.
Microsoft to cut jobs as earnings growth slows
Microsoft announced Monday that it will cut jobs, becoming the latest big technology company to trim its workforce as earnings growth slows. Microsoft declined to say how many people would be affected, but Axios reported one estimate of fewer than 1,000 jobs eliminated. The cuts will reportedly affect workers at various levels on the software maker's teams around the world. "Like all companies, we evaluate our business priorities on a regular basis, and make structural adjustments accordingly," Microsoft told Axios. "We will continue to invest in our business and hire in key growth areas in the year ahead."
Oil prices dip on news Biden plans to release more reserves
Oil prices edged lower early Tuesday following a Bloomberg report that President Biden might release another 10 million to 15 million barrels of oil from the Strategic Petroleum Reserve. U.S. benchmark West Texas Intermediate was down 0.2 percent to $85.29 a barrel. Brent crude, the international benchmark, was down 0.3 percent. The release would be part of a 180 million–barrel drawdown Biden started last spring. Oil prices, which surged after Russia invaded Ukraine in February, have declined in recent months on intensifying fears of a global economic slowdown that could weaken demand. The Organization of Petroleum Exporting Countries, along with allies led by Russia, recently agreed to boost prices by cutting production by two million barrels a day.
Stock futures jump after Monday's surge
U.S. stock futures surged early Tuesday after Monday's big gains. Dow Jones Industrial Average and S&P 500 futures were up 1.1 percent and 1.4 percent, respectively, at 6:30 a.m. ET. Nasdaq futures were up 1.7 percent. The Nasdaq rose 3.4 percent Monday in its best day since July. The Dow and the S&P 500 jumped 1.9 percent and 2.7 percent, respectively, with a lift from strong earnings reports. Some analysts warned that the market still could fall as Federal Reserve interest-rate hikes threaten to tip the economy into a recession. "This is going to be one of those bear market rallies that has people scratching their heads," Guy Adami, director of advisor advocacy at Private Advisor Group, predicted on CNBC's Fast Money.
Kanye West reaches deal to buy Parler social network
Parler said Monday that rapper Kanye West has agreed to buy the social network, which became popular with conservatives due to its promise to serve as a "free speech Twitter alternative." Parler parent company Parlement Technologies declined to disclose the financial terms of the tentative deal with West, who now goes by Ye. "In a world where conservative opinions are considered to be controversial we have to make sure we have the right to freely express ourselves," West said in a Parlement press release. He did not immediately respond to requests for further comment. The agreement marked the latest in a series of celebrity moves into the social media market, including Tesla CEO Elon Musk's controversial agreement to buy Twitter.