After Microsoft (MSFT) said it would increase productivity and lower costs by cutting its low-performance staff, Meta Platforms (META) will do the same.
Meta’s stock dropped by 2.31% yesterday to close at $594.25, despite the cost-cutting move. Markets are uncertain about how Meta would define performance. As a result, the unknown performance measures would create uncertainty. For example, how would the firm measure staff working on the metaverse? Metaverse will lose money until it achieves a bigger user base. Until then, it offers minimal revenue.
Conversely, staff who work on AI initiatives would perform better. Expect staff productivity to fall as they await the 5% job cut.
Economic News
Stocks will worry about this morning’s CPI report. Ahead of the inflation report, stock markets are already betting that the Federal Reserve will not cut rates anytime soon. Although the Fed is less inclined to target its 2% inflation rate, a pause in higher prices is not enough to justify a rate cut.
The U.S. is about to initiate a trade war among its partners. The Fed will need to prepare for rate hikes, should tariffs cause the price of goods to rise.
Among the stocks rising the most, be wary of Rigetti Computing’s (RGTI) 47.93% gain yesterday. B. Riley offered a bullish view on D-Wave Quantum (QBTS) on Tuesday. However, D-Wave needs investors to buy its newly issued stock. This dilution is not favorable for existing shareholders.
Related Stories
