Business briefing

The daily business briefing: November 10, 2022

Tesla shares plunge after Musk's latest share sale, Redfin closes its home-flipping unit, and more

1

Tesla shares fall to lowest level in 2 years after Musk sells more shares

Tesla shares dropped 7.2 percent on Wednesday to their lowest level in two years after the news that CEO Elon Musk had sold another $3.95 billion worth of the electric-vehicle maker's stock. Musk's latest share sale fueled concerns about fallout at Tesla from his $44 billion deal to acquire Twitter. Some investors fear Musk will divert resources to Twitter, or spend too much time wrestling with the chaos at the social media company instead of focusing on Tesla, the world's most valuable automaker, according to analysts. "I think investors are concerned that this might not be the end of his stock sales," OANDA senior market analyst Ed Moya said. Tesla is down nearly 60 percent from its November 2021 record.

2

Redfin shuts down house-flipping unit as housing market struggles

Real estate company Redfin Corp. on Wednesday said it was laying off 13 percent of its workers and shutting down its home-flipping unit. Redfin's decision to close the RedfinNow home-flipping business, which has been losing money, came after larger rival Opendoor Technologies reported record losses last week after selling too many homes for less than their purchase price. Redfin, which had already laid off 8 percent of its workforce in June, said the home-flipping operations had become too risky as the real estate market, which boomed earlier in the pandemic, struggles with falling sales and rising mortgage rates.

3

French company faces investigation over labor conditions at Qatar World Cup projects

A French judge has placed Vinci Construction Grands Projets, a subsidiary of French construction company Vinci, under formal investigation on preliminary charges of forced labor and other violations against migrant workers helping to build infrastructure needed in Qatar for the looming World Cup. The company said it did nothing wrong and would appeal. A human rights group, Sherpa, filed the initial complaint in 2015, and called the charges a breakthrough. The charges send "a strong signal for these economic players who profit from modern slavery," Sherpa president Sandra Cossart told The Associated Press. The allegations against the company include submitting workers to conditions incompatible with human dignity.

4

Stock futures rise ahead of inflation data

U.S. stock futures edged higher early Thursday as investors continue to digest the mixed results from Tuesday's midterm elections and await fresh inflation data. Futures tied to the Dow Jones Industrial Average and the S&P 500 were up 0.2 percent and 0.3 percent, respectively, at 6:30 a.m. ET. Nasdaq futures were up 0.5 percent. The Dow and the S&P 500 plunged 2.0 percent and 2.1 percent, respectively, on Wednesday, and the tech-heavy Nasdaq dropped 2.5 percent as uncertainty over which party had won control of the House and Senate dragged down stocks. Investors had been betting Republicans would take control, dividing power in Washington and creating the kind of gridlock markets like. Crypto exchange Binance's decision to drop plans to acquire rival FTX also dragged down tech stocks on Wednesday, and sent bitcoin's price to a two-year low.

5

China lockdown affects 5 million in export-hub Guangzhou

China has locked down large sections of the southern city of Guangzhou as authorities try to keep a widening COVID-19 outbreak from getting worse. The restrictions, which affect more than five million of the manufacturing hub's 19 million residents, came after Guangzhou reported 3,007 new infections on Wednesday, a relatively high figure under China's zero-COVID standards that accounted for a third of new cases nationwide. Local authorities hope to avoid the kind of citywide lockdown that devastated Shanghai, and dragged down China's economy, earlier this year. China has continued to use snap lockdowns and mass testing to prevent outbreaks from spreading, as other countries ease coronavirus restrictions. But the heavy costs have sparked an intensifying outcry.

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