Thursday’s Headlines: Google’s Russian Arm Bankrupt
Here were the biggest movers in the MyWallSt shortlist yesterday:
Moving Up ⬆️
Nautilus (NLS) +8.3%
Upstart Holdings (UPST) +3.6%
DraftKings (DKNG) 0.0%
BlackLine (BL) -0.5%
Moving Down ⬇️
Costco (COST) -12.5%
RH (RH) -11.9%
Lovesac (LOVE) -11.2%
Ulta Beauty (ULTA) -10.8%
Lululemon (LULU) -10.8%
1. Google (GOOG) has confirmed that its Russian subsidiary will be filing for bankruptcy following the seizure of its bank account by Russian authorities. A spokesperson for the Big Tech firm explained that, “the Russian authorities seizure of Google Russia's bank account has made it untenable for our Russia office to function, including employing and paying Russia-based employees, paying suppliers and vendors, and meeting other financial obligations.” Google has been under significant pressure from the Russian government for limiting access to some Russian media outlets across its platforms, and also for refusing to delete content deemed illegal by the Kremlin. Google has outlined that it plans to keep its free services, including YouTube and Gmail, available to Russian users. To find out more, click here.
2. Yesterday saw Tesla (TSLA) removed from the S&P 500’s Environmental, Social, and Governance (ESG) Index as part of its annual update. A spokesperson for the index cited three primary factors that ultimately led to Tesla’s removal: the “lack of a low-carbon strategy,” a history of “codes of business conduct,” and perhaps most worryingly, allegations of racism and sub-par working conditions reported at its factory in Fremont, California. Elon Musk reacted to the news by arguing that “ESG is a scam” and that S&P Global Ratings had “lost their integrity.” While there is certainly an argument to be made that Tesla is contributing to a more environmentally conscious society through the popularization of electric vehicles, the S&P are adamant that this alone isn’t enough, stating that “while Tesla may be playing its part in taking fuel-powered cars off the road, it has fallen behind its peers when examined through a wider ESG lens.” Read more here.
3. The retail industry has been decimated this week with many major companies, such as Costco (COST), suffering major share price declines. Some significant earnings misses sparked the slide for the sector, with weak offerings from both Target and Walmart in the past few days massively affecting most major retailers. Those two companies are down 24% and 17% respectively since their earnings calls. Inflationary challenges and continued supply chain problems have been the driving forces behind the current issues, as consumers begin to tighten their belts amid widespread economic uncertainty. With a host of other retailers expected to reveal earnings in the coming few weeks, this could be the start of a particularly volatile period for consumer-facing stocks. Click here to read more on the story.
Get this week’s full earnings calendar here.