Editorial StaffStocks wobble after a roller-coaster week dominated by Omicron concerns; Didi officially delists from the NYSE; D.C. shutdown averted; Elon Musk’s Tesla share-sale spree surpasses $10 billion; and back to the economy: November’s jobs report on tap.
Here are five things you must know for Friday, December 3:
1. — Stock Futures Wobble as Omicron Concerns Dominate
Stocks were looking wobbly Friday after a roller-coaster week dominated by concerns over the Omicron variant and its potential impact on the U.S. economy that sparked the biggest two-day declines on Wall Street in more than a year.
U.S. stocks equity futures were slightly lower Friday ahead of November’s nonfarm payrolls report that is expected to show solid jobs growth last month, with economists surveyed by FactSet predicting 581,000 positions added in November.
Futures contracts tied to the Dow Jones Industrial Average were indicating a 81-point opening gain at last check, while those linked to the S&P 500 are priced for a 13.5-point drop. Futures tied to the tech-focused Nasdaq Composite are indicating a 51-point decline at the start of trading as benchmark 10-year Treasury note yields hold at 1.444% in overnight trading.
The CME Group’s benchmark volatility index, the VIX, remains at six-month highs amid ongoing questions regarding the potential prevalence of Omicron, its resistance to current vaccines and the severity of symptoms associated with infection.
2. — Didi Moves to Delist From the New York Stock Exchange
Didi Global (DIDI) – Get DiDi Global Inc. Report said Friday that it would “immediately” start the process of delisting from the New York Stock Exchange and pivot to Hong Kong, just months after its disastrous IPO.
“After a careful study, the company will start delisting on the New York Stock Exchange immediately, and start preparations for listing in Hong Kong,” the Chinese ride-hailing firm wrote Friday on its verified account on Weibo, a popular Twitter-like platform in the country.
In a separate, English-language statement, the company said that its board of directors has authorized the company to file for delisting in New York.
The board will “organize a shareholders meeting to vote on the above matter at an appropriate time in the future, following necessary procedures.”
The announcement comes just five months after Didi launched its blockbuster, $4.4 billion IPO in the U.S. that was quickly overshadowed after the Chinese government cracked down on the firm, saying shortly after the offering that it would ban Didi from app stores in China because it broke privacy laws and posed cybersecurity risks.
The company’s stock is now worth about half of its $14 per share IPO price, a loss of nearly $30 billion in market capitalization, though its stock was climbing in premarket trading on Frida
Besides Softbank (SFTBY) , Uber Technologies (UBER) – Get Uber Technologies, Inc. Report is the second-largest outside shareholder, with an 11.9% holding. Chinese video game maker and WeChat app operator Tencent Holdings (TCEHY) owns 6.4% of Didi.
3. — Washington to Stay Open for Business Through Mid-February
Congress averted a government shutdown Thursday evening when both chambers voted to pass a stopgap bill to extend funding through mid-February after party leaders brokered a deal to overcome GOP brinkmanship over vaccine mandates.
The final tally in the Senate was 69-28.
Passage of the stopgap bill ahead of a midnight Friday deadline ended a standoff that had threatened to trigger a shutdown when a small number of Republican senators who object to President Joe Biden’s vaccine requirements had held out the possibility of holding up a quick vote on the funding bill.
To resolve the impasse, the two parties agreed to hold votes on the stopgap bill as well as a GOP amendment to prohibit the use of federal funding for Covid-19 vaccine mandates, which ultimately failed.
Earlier on Thursday, the House passed a continuing resolution to fund the government through February 18. The final vote was 221-212.
4. — November Nonfarm Payrolls Report on Tap
The U.S. economy likely added more than half a million new jobs last month as hiring continued to accelerate into the holiday shopping season amid improving growth prospects and labor market shortages – even as the Omicron variant raised new concerns about potential restrictions and lockdowns.
The Bureau of Labor Statistics will publish its official nonfarm payroll report at 8:30 am ET on Friday, with economists looking for a headline total that represents around 571,000 new jobs, a figure that would add to the 531,000 positions created in October.
Payroll processing group ADP said Thursday in its National Employment Report that private sector jobs grew by 534,000 in November, just ahead of consensus forecasts of a 506,000 total.
“Job gains have eclipsed 15 million since the recovery began, though 5 million jobs short of pre-pandemic levels,” Nela Richardson, chief economist, ADP, said in a statement accompanying the report, adding that it’s “…too early to tell if the Omicron variant could potentially slow the jobs recovery in coming months.”
Even with November gains, the number of Americans leaving the workforce remains near all-time highs, with some 10.4 million positions vacated or left unfilled as of the end of September, near the highest since December 2000, the Labor Department said last month in its monthly Job Openings and Labor Turnover Survey, or JOLTS report.
5. — Elon Musk Tesla Share Sale Tops $10 Billion
Tesla (TSLA) – Get Tesla Inc Report CEO Elon Musk has now unloaded more than $10 billion in Tesla stock.
Musk on Thursday sold more than 934,000 Tesla shares valued at just over $1 billion, according to regulatory filings. The sales came as Musk exercised more than 2.1 million vested Tesla stock options.
Musk kicked off his share-selling spree on Nov. 8, about two months after establishing a plan to exercise at least some of his nearly 23 million vested stock options set to expire in August 2022 and to sell some of the shares to cover tax withholding obligations.
Musk, the world’s richest person and Tesla’s top shareholder, tweeted that he would sell 10% of his stock if users of the social media platform approved the move.
Musk’s followers did vote in favor of the stock sale, and Musk did sell the shares, though subsequent reports indicated Musk had submitted regulatory filings for that share sale months ago anyway.
Based on his total holdings before the Twitter poll, Musk likely would need to sell more than 12 million additional shares following his latest transactions to hit the Twitter target. The precise number depends on how he defines his ownership stake.
At last check, shares of Tesla were down 0.29% at $1,081.50 in premarket trading. The stock is up 48.62% year to date.
