Finimize - 🎲 Hasbro's losing at Monopoly

Hi Reader, here's what you need to know for February 17th in 3:08 minutes.

🗞 They say that no news is good news – but when it comes to investing, you always want to know the 411. So join Adrian Alberts for The Relationship Between News And The Markets on Tuesday, and find out how headlines can help – and hinder – your portfolio.
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Today's big stories

Toymaking giant Hasbro gave a disappointing profit forecast for the year, and investors went searching for a new playmate
Stocks could be learning to take rate hikes in their stride – Read Now
Food and drink titan Nestlé posted paltry results that satisfied nobody’s appetite

Not Child’s Play

What’s Going On Here?

Toymaker Hasbro gave a disappointing outlook on Thursday, and investors decided the firm’s a problem child.

What Does This Mean?

Hasbro’s preliminary results update last month showed that demand for its toys dropped off a cliff last quarter – so the firm decided to run a tighter ship and lay off 15% of its workforce. But if anyone was actually reassured by that move, this week’s outlook set them straight: the owner of My Little Pony and Monopoly released an annual forecast that was way below analysts’ expectations. And it’s not hard to see why: after all, retailers will probably continue to play it safe with orders after overstocking last year. And lately Hasbro's lost some important licenses – like the Disney Princess range poached by rival Mattel – which could dent profit big-time. Obviously that wasn’t the bedtime story investors wanted, and they sent Hasbro's shares tumbling.

Why Should I Care?

Zooming in: Life in plastic.
Kids are really annoying when they cry, which means that demand for toys typically withstands the most Herculean economic hardships. But not this earnings season. Mattel gave a weak outlook of its own earlier this month, and now it’s ransacking its iconic back catalog to try and woo consumers with old favorites. The firm announced earlier this week that Barney – the famous TV dinosaur – will be back on the airwaves and store shelves before long. And that's not to mention this year's hotly anticipated Barbie movie.

The bigger picture: Workers beware.
Another day, another layoff announcement – and Hasbro's bout of job-slashing shows that's not just confined to tech. In fact, S&P 500 companies' profits fell for the first time since 2020 this earnings season, a sign there could be more cuts to come. That's the way the wind seems to be blowing anyway: a recent business survey showed that more respondents expect payrolls to fall than rise over the coming months – the first time that's been the case for two years.

You might also like: Beware: this is the start of the S&P 500’s witching hour.

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Analyst Take

Interest Rates Could Push Even Higher, But Stocks May Weather It Just Fine

Reda Farran, Analyst

January’s blockbuster US jobs report strengthened the argument for more interest rate hikes, with some Federal Reserve officials warning that rates will have to climb even higher than predicted.

And traders have started placing big bets on rates going to 6% by September – more than a full percentage point higher than today’s levels.

But despite all that, US stocks have stayed virtually flat.

So that’s today’s Insight: why the next hikes probably won’t shove stocks around quite like the first ones did.

Read or listen to the Insight here

Artificial intelligence (AI) could change the way we live, think, and invest

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As soon as ChatGPT burst onto the scene, our analysts explained why the game-changing chatbot deserves investors’ attention.
Then Microsoft invested in ChatGPT’s owner OpenAI, making Big Tech an even more obvious way to play the trend. But according to our analysts, chipmaker Nvidia could be a much savvier way in.
And in a full-circle moment, it turns out that ChatGPT itself can help you pick out stocks – yup, including AI ones.
To top it all off, our analysts uncovered another AI-powered platform – brimming with analytical tools that were once reserved for high-rolling hedge funds – that could completely transform the way you invest.

So there you have it: your jargon-free tour of AI opportunities.

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