Level 1 - Absolute Beginner
This week is a big week for company news. Many companies will tell us how much money they made. This is called earnings.
Netflix will report on Tuesday. Tesla and Meta will report on Wednesday.
Oil is very expensive. It is about 110 dollars a barrel. This makes many things cost more.
The last week was hard for tech stocks. The Nasdaq had its worst week since June, one report says.
- earnings
- The money a company makes after paying its costs.
- report
- To give news or numbers.
- stock
- A small piece of a company that you can buy.
- oil
- A liquid used to make fuel.
- barrel
- A big container for oil.
- week
- Seven days.
- company
- A business.
- expensive
- Costing a lot.
Level 2 - Elementary
Wall Street faces a busy week of company reports. Netflix reports on Tuesday, October 20. Tesla and Meta report after the market closes on Wednesday, October 21.
Investors are watching oil closely. Brent crude rose 3.7 percent on Friday to about 110 dollars a barrel. When oil is expensive, it costs more to move goods and to run factories.
The 10 year Treasury yield ended the week at 5.09 percent, down from 5.24 percent a week earlier. The Nasdaq had its worst week since June, according to one report.
Experts say the main question is simple. Which companies can pass higher costs on to their customers? The Federal Reserve is also quiet, because its officials are in a communications blackout until October 29.
- investor
- A person who puts money into something to make more.
- yield
- The return you earn on a bond.
- Treasury
- The part of the government that borrows money by selling bonds.
- customer
- A person who buys from a business.
- blackout
- A period when no information is shared.
- goods
- Things that are made and sold.
- closely
- With great attention.
- expert
- A person who knows a lot about a subject.
Level 3 - Intermediate
Investors enter the week of October 19 with earnings from some of the biggest names in technology. Netflix reports on Tuesday, while Tesla and Meta follow after the close on Wednesday, with one calendar also listing SpaceX among the week's reports. One preview expects Tesla's earnings per share to fall about 14.5 percent from a year earlier, with revenue slipping roughly 1 percent.
Netflix is expected to post profit growth of around 39 percent on revenue of about 12.9 billion dollars, up almost 12 percent. Those numbers matter because the Nasdaq has just had its worst week since June, and investors want proof that spending on artificial intelligence and streaming is paying off.
The backdrop is oil. Brent crude jumped 3.7 percent on Friday to roughly 110 dollars a barrel as supply worries from the Strait of Hormuz persisted. Analysts frame the week as a margin test: which companies can absorb or pass on higher costs?
Bond markets sent a mixed signal. The 10 year Treasury yield closed at 5.09 percent, down from 5.24 percent a week earlier, even after hot inflation data, as buyers piled into government debt. Federal Reserve officials are barred from public comment until October 29, which leaves the markets to read the data alone.
- earnings per share
- A company's profit divided by the number of its shares.
- slipping
- Falling slightly.
- backdrop
- The background against which events take place.
- supply
- The amount of something available to buy.
- margin
- The gap between what something costs and what it sells for.
- absorb
- To take in and bear a cost.
- barred
- Not allowed.
- piled into
- Rushed to buy in large numbers.
Level 4 - Advanced
A crowded earnings calendar arrives at a delicate moment for equities. Netflix reports on Tuesday, October 20, and Tesla and Meta follow after the bell on Wednesday, with one calendar also listing SpaceX. One preview pencils in a 14.5 percent decline in Tesla's earnings per share on revenue down about 1 percent, whereas Netflix is projected to grow profit by roughly 39 percent on sales of about 12.9 billion dollars.
The Nasdaq has just endured its weakest week since June, so the market is hunting for evidence that heavy investment in artificial intelligence and streaming translates into durable profit. Meta and Tesla, both defined by large capital commitments, will be scrutinised on exactly that point.
Macroeconomic currents complicate the picture. Brent crude surged 3.7 percent on Friday to about 110 dollars a barrel as the standoff over the Strait of Hormuz kept supply fears alive, turning the earnings season into what one analyst called a trial of profit margins. Companies with pricing power can pass costs on; those without will see the squeeze in their guidance.
Fixed income offered a counterpoint. The 10 year Treasury yield slid to 5.09 percent from 5.24 percent, even after a hot inflation reading, as investors sought the shelter of government paper despite mounting worries about leveraged AI infrastructure. With the Federal Reserve in a communications blackout until October 29, corporate commentary will carry unusual weight.
- equities
- Shares of companies traded on a stock market.
- durable
- Lasting over a long time.
- scrutinised
- Examined very closely.
- macroeconomic
- Relating to the economy as a whole.
- pricing power
- The ability to raise prices without losing customers.
- guidance
- A company's own forecast of future results.
- fixed income
- Investments such as bonds that pay set returns.
- leveraged
- Financed with borrowed money.