Aug 25, 2022 TradeUP Thursday Latest news and bulletin updates
Market Trends
Dow Jones 33,029(-0.03%)
S&P 500 4,153(+0.30%)
NASDAQ 12,506(+0.50%)
(Opening price as of 08/25/2022 compared to last close)
Weekly Highlights
#1
Investors focused on Powell’s appearance Friday at the annual Jackson Hole conference
#2
Peloton plunged in premarket after reporting a larger than expected loss of revenue
#3
Tesla shares are up after its 3-for-1 stock split after yesterday’s market close
#4
Bed Bath & Beyond surged on Wed after report on financing deal
Share Your Thoughts:
Twitter’s former employee claimed that the company was in violation of the FTC Act and SEC regulations
Shares in Twitter tumbled 7% on Tuesday following reports that Peiter Zatko, the company’s former security chief, acted as a whistleblower and had filed a complaint with the SEC last month. The whistleblower complaint is about Twitter’s disregard for cybersecurity issues, including Musk’s bot claims. The former security chief also submitted complaints to Congress, the Justice Dept., and the FTC.
On Tuesday, Twitter’s shares closed at about $39.86, significantly below the $54.20 per share Musk offered in the acquisition deal. The market seemed to believe that the whistleblower claims would help Musk win the lawsuit and get out of the Twitter acquisition case.
However, there are still a few of questions behind the whistleblower complaint:
1. Why did the security chief decide to go public?
U.S. official agencies, especially the SEC, have whistleblower rules and programs. If the claim is eligible and verified, the whistleblower will receive an award ranging from 10% to 30% of the money collected when the monetary sanctions exceed $1 million. The SEC normally never discloses the identity of the whistleblower for safety reasons, however in this case, Twitter’s former security chief took the initiative to go public.
2. Why was the whistleblower complaint submitted last month?
Twitter’s former security chief was fired in January, but the complaint was submitted to the SEC in June, almost half a year after his termination.
3. Why did the whistleblower submit complaints to other official departments other than the SEC?
Since Twitter is a publicly listed company, the SEC is the direct regulatory agency for its supervision. However, the whistleblower complaints have also been submitted to the U.S. Congress, Dept. of Justice, and the FTC.
Twitter has already been criticized by both parties in Congress. Republicans criticized the platform for regulations on conservative content, while Democrats criticized the platform for not regulating enough. There’s bipartisan support in Congress for further reining in social media platforms. A federal jury has also just convicted a former Twitter employee for selling people's private information to the Saudi Arabian government.
Obviously, cybersecurity issues will be much more important than Musk’s alleged bot account issue. While Musk has already sold an additional $6.9 billion shares in Tesla in preparation for buying Twitter, the deal might still be broken if Congress and the Dept. of Justice can confirm that the company has been in violation of the FTC Act and SEC regulations.
What do you think will be the result for the Twitter-Musk lawsuit?
A.Twiiter wins
B.Musk wins
C.Hard to tell
Share your thoughts with us for a chance to win a free stock!
Inside Scoop
#1. Investors focused on Powell’s appearance Friday at the annual Jackson Hole conference
• The benchmark 10-year U.S. Treasury yield eased slightly to 3.098% from 3.105% on Wednesday.
• Economic data showed that initial filings for unemployment benefits fell last week, and revisions show a smaller GDP decline in the second quarter.
#2. Peloton plunged in premarket after reporting a larger than expected loss of revenue
• Peloton shares are skidding after the pandemic-era darling reported a quarterly loss. The company also said its connected fitness business would remain challenging going into 2023.
• Peloton has struck a partnership with Amazon to sell fitness equipment and apparel through its platform.
#3. Tesla shares are up after its 3-for-1 stock split after yesterday’s market close
• Trading starts on a split-adjusted basis Thursday. The newly split Tesla stock was trading at $302.40 a share, up about 1.8%, in premarket trading.
• The company has also announced its “AI Day” in Palo Alto on Sept. 30. Tesla has released new deep-dive presentations on its Dojo AI supercomputer.
#4. Bed Bath & Beyond surged on Wed after report on financing deal
• Bed Bath & Beyond Inc. shares jumped 18% on Wednesday after a report that the home goods retailer has selected a lender to provide financing as it seeks to boost liquidity.
• Bed Bath & Beyond snapped a four-day losing streak that saw shares tumble more than 70% from last week’s peak through Tuesday’s close.
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