5 Things to Know Before Markets Open

News of the day for May 5, 2023

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The Labor Department will release its monthly job report and the FDIC is reportedly planning to make big banks cover the fees for recent rescues. Here’s what investors need to know today.

1. Jobs Report Expected to Show Slower Growth, Higher Unemployment

Following two straight days of market declines after the Fed's latest rate hike and amid banking worries, investors will be closely following today’s job report release at 8:30 a.m. Job growth is expected to slow to 180,000 new positions in April, fewer than in March, when the economy added 236,000 jobs. The unemployment rate is projected to tick up to 3.6% from 3.5%.

2. FDIC Planning to Give Big Banks the Rescue Bill, Exempting Smaller Lenders

The Federal Deposit Insurance Corporation (FDIC) is reportedly planning to put most of the bill on replenishing its insurance fund on the biggest banks, exempting some smaller lenders from having to cover the extra costs associated with the recent rescues. The FDIC is planning to soon release the insurance fund proposal, which would exempt lenders with less than $10 billion in assets, covering more than 4,000 institutions.

3. Apple Shares Rise on Higher iPhone Sales

Apple (APPL)  shares rose 2% in extended trading after it posted a surprise 1.5% increase in iPhone sales in the first quarter, while global smartphone shipments fell 13% over the same period. Apple CEO Tim Cook said that sales in India and other emerging markets helped drive the growth, where Apple was able to take market share from Android phones.

4. Coinbase Global Shares Move Higher on Earnings Beat

Coinbase Global  (COIN)  shares are up nearly 8% in pre-market trading after it reported improving revenue of $773 million and narrowed losses to 34 cents a share, better than analyst expectations. The cryptocurrency exchange was boosted by a rising price of Bitcoin, but still faces a potential regulatory battle with the Securities and Exchange Commission.

5. Lyft Shares Tumble on Lower-Than-Expected Revenue Projections

Lyft  (LYFT) shares fell 15% in pre-market trading after it offered a weak forecast. Lyft said its revenue will be about $1 billion in the second quarter compared to analyst estimates of $1.08 billion. Lyft also reported fewer than expected active riders, signaling that efforts to lower fares to boost ridership and gain market share are falling short.

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  1. Yahoo Finance. “Jobs report: Hiring expected to slow in April as rate hikes weigh on growth.”

  2. Bloomberg. “FDIC Plans to Hit Big Banks With Fees to Refill Deposit Insurance Fund.”

  3. Yahoo Finance. “Apple Q2 earnings beat expectations on better than anticipated iPhone sales.”

  4. Barron's. “Coinbase Stock Surges After Strong Results but Legal Dangers Remain.”

  5. CNBC. “Lyft shares plunge 15% on weak second-quarter guidance.”

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