The daily business briefing: April 3, 2023
Latest OPEC+ production cut sends oil prices rising, Tesla reports record quarterly deliveries after price cuts, and more
Oil prices surge after OPEC+ announces surprise output cut
OPEC+ on Sunday announced an unexpected one-million-barrel-per-day production cut. The group of oil exporting countries, led by Saudi Arabia and Russia, had previously said they would keep supply steady. The reversal threatens to push energy costs higher and slow an already weakening global economy. Saudi Arabia pledged to cut its output by 500,000 barrels a day. Kuwait, the United Arab Emirates, and Algeria also plan to reduce production. Russia said it would extend its March to June reductions through the end of 2023. "OPEC+ clearly want a higher price," said Gary Ross, a veteran oil consultant turned hedge fund manager at Black Gold Investors LLC. News of the cuts sent oil prices jumping 5 percent early Monday.
Tesla quarterly deliveries hit record after price cuts
Tesla's first-quarter sales jumped 36 percent, pushing its deliveries to a record 422,875 vehicles for the quarter, billionaire Elon Musk's electric-car company said Sunday. The surge came as Tesla cut prices on some of its models twice in the first three months of 2023 to boost weakening demand. Despite the gains, deliveries came in slightly short of the 432,000 expected by analysts surveyed by FactSet. "In recent months Tesla has pivoted from being supply-constrained to being demand-constrained," said Barclays analyst Dan Levy, forecasting further price cuts in a note to investors. Tesla stock had its worst year on record in 2022, dropping 65 percent before clawing back some of the losses in 2023.
UBS to cut up to 30 percent of workforce after Credit Suisse takeover
Swiss banking giant UBS plans to cut as many as 36,000 jobs worldwide, up to 30 percent of its workforce, Bloomberg reported Sunday, citing an article in SonntagsZeitung, Switzerland's biggest newspaper. UBS is reworking its operations as it completes a takeover of rival Credit Suisse. Swiss prosecutors are collecting evidence for a possible criminal investigation into the takeover, which Swiss regulators pressed UBS into after years of Credit Suisse scandals led to mass withdrawals of deposits that threatened to sink the bank. The $3.3 billion takeover by Credit Suisse's larger rival came after five days of talks brokered by Swiss government officials.
Twitter removes Times' blue verified badge
Twitter on Sunday removed the blue "verified" check mark from the main New York Times account. Twitter's billionaire owner, Elon Musk, had called for stripping the Times of the badge hours earlier after learning that the newspaper had ruled out paying for the Twitter Blue service. The decision to strip verification from the Times contradicted Twitter's internal policy of letting its 10,000 most-followed organizations keep the badges whether they pay or not. Twitter said it started to unravel its old verification system over the weekend, removing blue-check icons it previously put on accounts of verified companies, journalists, and public figures. It is replacing the system with a badge for any users who pay $8 per month for it. Businesses will pay $1,000 a month.
Stock futures mixed as second quarter kicks off
U.S. stock futures were mixed early Monday ahead of the start of trading in the second quarter, as an unexpected output cut by OPEC+ oil producers sent oil prices rising and gave energy companies a boost. Futures tied to the Dow Jones Industrial Average were up 0.4 percent at 6:45 a.m. ET. S&P 500 and Nasdaq futures were down 0.1 percent and 0.6 percent, respectively. Oil giant Chevron's shares rose 3 percent in pre-market trading as oil prices surged by more than 5 percent on news of the production cut. All three of the main U.S. indexes gained in the first quarter, with the tech-heavy Nasdaq rising 16.8 percent to lead the way as technology stocks rebounded from big losses last year.