- Gold and Bitcoin recovered.
- GitLab made profits that impressed Wall Street.
- Moody’s has downgraded the Chinese government’s credit rating to negative.
Here are the key news investors need to start the trading day:
Stock markets took a break from their year-end rally on Monday. Small-cap stocks outperformed the rest of the market, with the Russell 2000 posting a 1% gain, but the Nasdaq Composite fell 0.84% as investors sold Big Tech stocks that had led the market higher. While the stock market rally took a break, gold and Bitcoin experienced their own rallies. Bitcoin crossed $41,000 to hit a 19-month high, while gold hit its highest ever nominal intraday value. Follow live market updates.
People celebrate GitLab’s IPO on Nasdaq on October 14, 2021.
Source: Nasdaq
Speaking of rallies, GitLab shares rose 14% in premarket trading on Tuesday as the company reported third-quarter results that impressed investors. The open source software development platform exceeded revenue and earnings in the third quarter and provided strong guidance for the current quarter. These results mark the first time that GitLab – which went public in 2021 – has posted an adjusted operating profit. Meanwhile, GitLab’s revenue rose 32% year-over-year in the quarter ended Oct. 31.
Jeff Lawson
Abigail Stevenson | CNBC
In less positive news for software providers, Twilio announced on Monday that it would lay off about 5% of its workforce as part of a broader plan to streamline the company. The cuts will impact about 300 employees, based on Twilio’s headcount in its most recent regulatory filing, and CEO Jeff Lawson said they will focus on the company’s data and applications unit. This is the same entity that activist investors have targeted in the past. Lawson also said in a letter that the layoffs would eliminate “many” sales positions for its digital engagement product, Flex. Twilio has now experienced three rounds of layoffs in just over a year.
A Chinese flag flies in front of a residential complex in Beijing on April 30, 2017.
Greg Baker | Afp | Getty Images
Ratings agency Moody’s has downgraded its outlook for the Chinese government’s creditworthiness from stable to negative. In making the decision, Moody’s said it was concerned about rising debt risks as Beijing’s fiscal support for struggling local governments and state-owned enterprises could weaken the country’s overall strength. “The change in outlook also reflects the increased risks associated with structurally and persistently lower medium-term economic growth and the ongoing decline in the real estate sector,” the agency said. Despite the downgrade, Moody’s maintained China’s A1 long-term rating on the country’s government bonds.
A mockup of the new Nokia logo is seen in this handout image released on February 26, 2023.
Nokia | Via Portal
Nokia shares tumbled on the Helsinki Stock Exchange on Tuesday after the telecommunications company missed out on a key deal with US giant AT&T. AT&T said it would instead partner with Nokia’s Swedish rival Ericsson on a nearly $14 billion project to deploy technology in the U.S., which AT&T expects to use for 70% of its wireless network traffic by the end of 2026. Meanwhile, Ericsson’s Stockholm-listed shares were up more than 7%. The new project means that Nokia, already struggling financially, will lose market share as a supplier to AT&T and that existing Nokia devices will be replaced in several places.
—CNBC’s Hakyung Kim, Jordan Novet, Rohan Goswami, Clement Tan and Jenni Reid contributed to this report.
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