Wall Street Lunch: No Starbucks For You?

The holiday season is upon us, and this year, it might be a rocky one for Starbucks (NASDAQ:SBUX). On Christmas Eve, the coffee giant is potentially facing its largest barista strike ever. Over the recent weekend and through Monday, about 60 Starbucks locations were temporarily closed due to actions initiated by the Workers United union.

Workers United has announced that this unfair labor practice strike could reach unprecedented levels, with hundreds of stores preparing to participate in the walkouts. They anticipate that the "Strike Before Christmas" will involve over 5,000 workers across more than 300 stores nationwide, surpassing the previous year’s Red Cup Rebellion.

Despite the looming strike, Starbucks emphasized that the majority of its stores (97-99%) remain operational and continue to serve customers. Some locations that had temporarily closed are now back open as partners return to work. The company reassured that they expect limited disruption to overall operations.

Market Updates

In today's market action, investors saw a positive trend. The Santa Claus Rally, a typical market behavior around the holidays, has begun, with stocks gaining steadily from the market's opening. The Nasdaq (COMP.IND) led the way, rising 1.35% and reclaiming the 20,000 mark. The S&P (SP500) gained 1.1%, closing above 6,000, while the Dow (DJI) increased by 0.9%, ending above 43,000.

This rally, first recorded in 1972 by renowned Wall Street expert Yale Hirsch, is well-known among investors. His legacy continues, as his son Jeff now produces the Stock Trader's Almanac. They point out that when certain market indicators, like the Santa Claus Rally, the First Five Days, and the January Barometer show positive trends, there is a high likelihood of market gains in the following year.

Company Highlights

In company-specific news, prominent tech firms like Meta (META), Broadcom (AVGO), and Tesla (TSLA) have seen a significant increase in stock prices this year, leading to minor adjustments in their weights within the Nasdaq 100 (NDX). On the other hand, other big players such as Apple (AAPL), Nvidia (NVDA), Microsoft (MSFT), and Alphabet (GOOG) have gained higher weightings due to their increased performance.

Travel Woes

Travel woes also made headlines this morning as American Airlines (AAL) grounded all domestic flights due to a vendor technical issue. Fortunately, they resolved the problem quickly, allowing operations to resume shortly thereafter. The airline issued a travel alert to its customers for added flexibility and has avoided the chaos seen last holiday season with another airline.

Regulatory Challenges

In regulatory news, a coalition of banks has filed a lawsuit against the Federal Reserve regarding their annual stress tests. These tests require banks to maintain adequate reserves for potential loan losses, impacting their share buybacks and dividend payouts. The president of the Bank Policy Institute emphasized that the current regulations create instability, leading to inaccurate capital requirements.

Netflix’s Big Day

On a more positive note, Netflix (NFLX) is set to make headlines on Christmas Day with its NFL broadcasting debut, featuring two exciting matchups. Following streaming issues experienced during a previous event, the company assures users they are taking necessary steps to guarantee a smooth experience this time around, including significant upgrades to their streaming infrastructure.

The Curious Case of Scrooge & Marley

In a whimsical turn of events, the trading floor in London buzzed with news about a peculiar change in direction from the boutique brokerage, Scrooge & Marley Counting House. This firm announced a staggering 100% increase in labor costs for its upcoming fiscal year, leaving investors surprised without a clear revenue plan. CEO Ebenezer Scrooge commented on the changes but maintained a mysterious aura around his firm’s new initiatives, leaving traders speculating about future endeavors.

Starbucks, Strike, Market, Stocks, Travel