Elon Musk Closes Twitter Deal, Apple Reported Record Revenue, ECB May Turn Dovish
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Summary:
- Elon Musk has finalized his $44 billion plan to take Twitter private.
- Record revenue was announced from APPL.
- Investors have been persuaded that the ECB may make a dovish turn.
Elon Musk Closes $44bn twitter deal
After months of legal fighting between the richest man in the world and the social media site, Elon Musk, he has finalized his $44 billion plan to take Twitter private, putting an end to one of the most high-profile and dramatic buyout sagas in recent memory.
The billionaire businessman removed Twitter's chief executive, Parag Agrawal, and chief financial officer, Ned Segal, as soon as he assumed control on Thursday night. According to one source, Sean Edgett, Twitter's general counsel, and Vijaya Gadde, the company's head of law, policy, and safety, were also fired.
Musk had first agreed to purchase Twitter for $54.20 per share in April. A few months later, he filed a lawsuit against the San Francisco-based business to cancel the agreement, claiming that the platform had misled investors and regulators about false accounts and cyber security. In an effort to pressure the billionaire to complete the transaction, the social media business retaliated and countersued, setting up a contentious court dispute and discovery process.
Musk declared he was prepared to purchase the business at the agreed-upon price provided the legal action was withdrawn just weeks before the two were scheduled to square off in a Delaware court over the matter.
The sale was finalized the day before, according to a regulatory filing from the New York Stock Exchange on Friday morning, and stock trading had been halted in anticipation of Twitter's delisting on November 8. In an effort to create a "super app" that combines messaging, payments, and commerce, Musk has pledged to reduce Twitter's workforce and operating expenses while fostering product innovation.
Elon Musk has completed his $44 billion deal for Twitter. The company's CEO and CFO were terminated and escorted out of headquarters https://t.co/nsktVzuCtn pic.twitter.com/SBWTIzqPnx
— Reuters (@Reuters) October 28, 2022
Apple (APPL) reports record earnings
On Thursday, Apple (AAPL) released financial results for the fourth quarter of its fiscal year. Record revenue was announced, but important categories including the iPhone and services fell short of analyst projections.
Actual revenue was $90.15 billion compared to the estimated $88.64 billion, and EPS came in at $1.29 vs the anticipated $1.26.
Although the Mac sales and revenue beats are positive, the iPhone and iPad numbers may worry investors. Apple has recently taken a beating amid rumors that the company is reducing the manufacturing of the Phone 14 Plus and as it navigates a challenging week for tech in general.
Like most tech companies, Apple is experiencing foreign exchange challenges brought on by a strong dollar, which is reducing overall income. A hawkish Fed, persistent inflation, and a consumer downturn that has lowered expectations for the forthcoming holiday season are all exerting pressure on tech businesses like Apple.
$AAPL shares remain steady after reporting record Q4 revenue.
— Yahoo Finance (@YahooFinance) October 28, 2022
“The Apple results were mixed, they were relatively strong enough,” @juleshyman says. “But not enough to salvage the whole tech earnings season and reassure investors.” pic.twitter.com/92fYGKeYYT
ECB could be turning more Dovish
Investors have been persuaded that the European Central Bank is about to make a dovish turn because of what appear to be merely minor changes in tone from Christine Lagarde and the governing council she chairs.
In a post-council meeting press conference, the ECB president acknowledged that the eurozone was likely headed for a recession, which had long been assumed by the majority of economists. The markets quickly interpreted this to mean that the region's rate-setters would scale back the pace of rate increases.
Following Lagarde's news conference on Thursday afternoon, interest rates on government borrowing plunged, and by day's end, the euro had fallen below parity with the dollar, wiping off some of its previous gains.
Investors broadly perceived such e statements as indicating that the ECB will decrease its next rate increase to 0.5 percentage points, and they now believe that by next September, borrowing prices will be a quarter-point lower than they believed prior to the ECB's announcement of its policy.
ECB convinces markets it is about to turn more dovish https://t.co/rCLmZ0WPD0
— Financial Times (@FT) October 28, 2022
Sources: finance.yahoo.com, twitter.com, ft.com
