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More than one in four, or 26%, of U.S. millionaire investors surveyed said they would add to their investments if financial markets decline further, according to the UBS Investor Sentiment survey.
Only 19% said they would decrease their investments, and 25% said they would make no changes.
The survey was taken between April 5 and April 18, before the most recent market drops. Yet wealthy investors don’t seem to be loading up on more cash.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., May 3, 2022. 
Brendan Mcdermid | Reuters

Wealthy investors are more likely to add to their stock holdings or shift out of certain sectors rather than sell if stocks continue to decline, according to a new survey.
More than one in four, or 26%, of U.S. millionaire investors surveyed said they would add to their investments if financial markets decline further, according to the UBS Investor Sentiment survey. Only 19% said they would decrease their investments, and 25% said they would make no changes.

The survey, of 900 investors and 500 business owners with at least $1 million in investible assets, found that 30% of investors said they would shift sectors if markets decline. When asked how likely they would be to invest in certain asset classes, the largest number, 37%, said stocks. They also plan to invest more in commodities, with 32% favoring gold and 31% favoring oil.
“I think it’s another case of investors doing good job of not overreacting,” said Jeff Scott, head of client insights at UBS Global Wealth Management. “It doesn’t mean they won’t make tactical changes. But they’re not selling out as the market has declined. We encourage people to have a financial plan and stick to it.”
Granted, the survey of investors was taken between April 5 and April 18, before the most recent market drops. Yet wealthy investors don’t seem to be loading up on more cash. The average holdings of cash and cash equivalents actually fell slightly to 19% of investable assets, compared to 20% in the February Investor Sentiment.
Those who are holding a large amount of cash are worried about the affects of inflation. Among those holding more than 10% of their assets in cash, two thirds are “highly concerned about inflation’s impact on the real value of their cash,” according to the survey.
A majority of investors cite inflation as a leading investment concern, just behind politics and geopolitical risk. A majority, 51%, also said volatility is higher than usual, with the S&P down 13% so far this year and the Nasdaq down 21%.

While the market swings, concerns about rate hikes and inflation are taking center stage, Scott said wealthy investors are taking some comfort in receding fears over Covid-19.
“The pandemic is not over, but it does seem like there is a greater sense of returning to normalcy,” he said. “At least in the U.S. that is somewhat counter-balancing the increased concerns about Russia, Ukraine and inflation.”

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Ford on Wednesday reported a 10.5% decline in April sales compared with a year ago, notably narrowing its losses compared with recent months.
The automaker has been attempting to prioritize chip supplies for in-demand products such as the electric Mustang Mach-E crossover, which nearly doubled in sales compared with April 2021.

Ford F-150 Lightning pickup trucks sit on the production line at the Ford Rouge Electric Vehicle Center on April 26, 2022 in Dearborn, Michigan.
Bill Pugliano | Getty Images

DETROIT – Ford Motor on Wednesday reported a 10.5% decline in April sales compared with a year ago, notably narrowing its losses compared with recent months.
Ford and the broader auto industry continue to battle through supply chain problems such as a semiconductor chip shortage that has been affecting production for more than a year now. Ford’s monthly U.S. sales in February and March were down by more than 20% due to the problem.

“While industry semiconductor chip shortages persist, improved inventory flow in April delivered a significant share gain of 1 percentage point over a year ago with Ford outperforming the industry,” Andrew Frick, Ford vice president of sales, distribution and trucks, said in a statement.
The automaker has been attempting to prioritize chip supplies for in-demand products such as the electric Mustang Mach-E crossover, which nearly doubled in sales compared with April 2021. Sales of newer vehicles such as the Maverick small pickup and Bronco SUV also improved compared with March.
Sales of Ford’s crucial F-Series full-size pickup trucks, including the F-150, continue to struggle due to supply problems. Last month sales were down 22%, pushing them to be down nearly 30% for the year. F-Series sales did increase by 15% compared with March, signaling improved production and supplies.
Ford sold 609,097 vehicles through April, a 15% decline compared with a year earlier. The company’s sales from March to April increased by 11%.

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FA Playbook

Amid high inflation and rising interest rates, many worry about a prolonged stock market downturn.
To prepare, retirees need a cushion of cash to avoid selling assets at reduced prices, advisors say.
However, the exact amount depends on other sources of income and expenses.
“Retirement is not cookie-cutter, and it’s not just a one-stop shop,” said certified financial planner Brad Lineberger, president of Seaside Wealth Management in Carlsbad, California.

Luminola | E+ | Getty Images

Amid high inflation and rising interest rates, there are fears of a prolonged stock market downturn, and some retirees may be vulnerable without a cushion of cash, financial experts say.
However, there’s also the risk of crumbling purchasing power, with annual inflation growing by 8.5% in March, the U.S. Department of Labor reported.

Meanwhile, average savings account yields are still below 1% as of May 4, according to DepositAccounts.com, making cash less attractive.

More from FA Playbook:

Here’s a look at other stories impacting the financial advisor business.

The right amount of cash depends on each retiree’s situation, said certified financial planner Brad Lineberger, president of Seaside Wealth Management in Carlsbad, California.
“There’s not a silver bullet or a magic answer,” he said.
Advisors may suggest keeping three months to six months of living expenses in cash during a client’s working years.
However, the number may shift higher as they transition to retirement, said Marisa Bradbury, a CFP and wealth advisor at Sigma Investment Counselors in Lake Mary, Florida.

The worst thing you want to do is sell your wonderful investments while they are at bargain-basement prices.

Brad Lineberger
president of Seaside Wealth Management

Many advisors recommend retirees keep a larger cash buffer to cover an economic downturn. A retiree with too little cash may have to dip into their portfolio and sell assets to cover living expenses.  
“The worst thing you want to do is sell your wonderful investments while they are at bargain-basement prices,” said Lineberger. 
Bradbury suggests retirees keep 12 months to 24 months of living expenses in cash. However, the amount may depend on monthly costs and other sources of income.
For example, if their monthly expenses are $4,000, they receive $2,000 from a pension and $1,000 from Social Security, they may consider keeping $12,000 to $24,000 in cash.

Asset allocations

Another factor is a portfolio’s percentage of stocks and bonds.
Research shows how long certain allocations may need to recover after stock market corrections, said Larry Heller, a Melville, New York-based CFP and president of Heller Wealth Management.
For example, a portfolio with 50% stocks and 50% bonds may take 39 months to recover in a worst-case scenario, according to research from FinaMetrica. That’s why Heller may suggest holding 24 months to 36 months in cash.  

Still, some retirees push back on holding large amounts of cash in today’s low interest rate environment. 
“It’s a lot easier to leave that cash in the bank when it’s earning 3%, or 4% or 5%,” Bradbury said. However, advisors may remind their clients that growth isn’t the purpose of short-term reserves.
“Look at the cash as the security blanket that’s allowing you to invest in the most incredible wealth-creating machine, which is stocks of wonderful companies,” Lineberger said.

Cutting back on cash

While some advisors suggest retirees hold 12 months to 36 months of cash, others may recommend less liquidity.
“The way we look at cash is that it’s a drag on long-term performance,” said Rob Greenman, a CFP and chief growth officer at Vista Capital Partners in Portland, Oregon.
“Absent from having tomorrow’s newspaper, there’s really no reason to be sitting on cash to be waiting for a better opportunity,” he said.

Retirees who need quick access to funds may consider other sources, such as a home equity line of credit, a health savings account, a pledged asset line of credit and more, Greenman said.
Of course, the ideal cash amount depends on each retiree’s unique situation. Those struggling to decide may benefit from weighing the consequences of more or less cash with a financial advisor. 
“Retirement is not cookie-cutter, and it’s not just a one-stop shop,” said Lineberger. “It’s very personalized, and our emotions can really affect our decision-making.”  More

Stand-up comedian Dave Chappelle on Tuesday was attacked by an audience member during a live performance at the Hollywood Bowl in Los Angeles, Police said.
A male suspect on Tuesday evening jumped on stage and onto Chappelle as he was about to exit, police said. Security officers intervened at that time to detain the suspect.
Fellow comedian Chris Rock, who was attacked onstage by Will Smith at the Oscars in March, joined Chappelle onstage shortly after Tuesday’s incident.

Chappelle was not injured as a result of the attack, LAPD said.
Kevin Mazur | Getty Images Entertainment | Getty Images

U.S. stand-up comedian Dave Chappelle was attacked by an audience member during a live performance at the Hollywood Bowl in Los Angeles, according to the Los Angeles Police Department.
A male suspect on Tuesday evening jumped on stage and onto Chappelle as he was about to exit, police said. Security officers intervened at that time to detain the suspect.

The suspect, whose identification is currently being withheld, suffered “superficial injuries” while being detained. He has been taken to a hospital for injuries and to be evaluated.
The LAPD said the man was armed with a replica gun that ejects a knife blade when discharged. It wasn’t immediately clear what the suspect’s motive was.
Chappelle, who was performing as part of the Netflix Is A Joke festival, was not injured in the attack, the LAPD said.
Netflix didn’t immediately respond to CNBC’s request for comment.
The incident appeared to align with fears in the comedy world that Will Smith’s Oscars attack on Chris Rock, who joined Chappelle onstage after Tuesday’s events, could lead to similar incidents. Smith was banned from the Academy Awards for 10 years over his onstage assault of Rock, but Rock didn’t press charges.

Rock appeared alongside Chappelle shortly after the incident, according to footage circulating on social media. He was seen taking a microphone from Chappelle to quip, “Was that Will Smith?”
Chappelle recently struck a new deal with Netflix to produce more comedy specials after recent controversies. The 48-year-old comedian faced sharp criticism and protests last year when his routine in the Netflix special “The Closer” was accused of being transphobic.
In October, hundreds of people protested outside Netflix’s headquarters, calling on the streaming giant “to avoid future instances of platforming transphobia and hate speech.” Chappelle said in his Netflix special that LGBT people were “too sensitive” and that “gender is a fact.” He has since hit back at those he claims are trying to “cancel” him.
British comedian Jimmy Carr also performed at Tuesday’s event. Carr sparked outrage earlier this year after comments about the Gypsy, Roma and Traveler communities in his Netflix special, “His Dark Material.”
“The Hollywood Bowl show with the legendary Dave Chappelle was crazy,” Carr said via Twitter. “Just happy everyone’s ok.”

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Tickets to this weekend’s Formula 1 Grand Prix in Miami are selling for thousands of dollars a piece.
Miami’s top hotels, restaurants and night clubs are offering high-priced packages for race-goers.
Event organizers project an economic impact of $400 million to the city of Miami Gardens, where the Hard Rock Stadium and track are located.

Max Verstappen of the Netherlands driving the (1) Oracle Red Bull Racing RB18 to the grid before the F1 Grand Prix of Emilia Romagna at Autodromo Enzo e Dino Ferrari on April 24, 2022 in Imola, Italy.
Dan Istitene – Formula 1 | Formula 1 | Getty Images

Tickets to this weekend’s Formula 1 Grand Prix in Miami are selling for thousands of dollars a piece, as surging U.S. interest and the global wealthy drive up prices for a weekend of high-speed excess.
More than 300,000 race fans, tourists, executives and party-goers are expected to pour into Miami for the event, sponsored by Crypto.com. It’s the racing league’s inaugural Miami event and takes place across three days starting on Friday.

The crowds and spending are expected to surpass Miami’s 2020 Super Bowl and its annual Art Basel festival, according to local officials. Miami’s top hotels are charging more than $100,0000 a night for their top suites. Chefs are offering special dinners for $3,000 a plate, and night clubs are bringing in top DJs with tables going for up to $100,000 a night.
“This is going to be the biggest week in Miami history,” said Jeff Zalaznick, managing partner of Major Food Group, which has sold out its dinner on Miami Beach at $3,000 per person. “We’ve never seen demand like this. It’s going to be a very hedonistic experience.”
Formula 1 has always been a sport for the rich, whether watching from their mega-yachts in Monaco or the SkyPark at the Marina Bay Sands in Singapore. Miami’s Grand Prix will mark a whole new level of spending for a U.S. sporting event — fueled by the surging popularity of Formula 1, and the post-pandemic wealth boom in south Florida.
Netflix’s hit series “Drive to Survive” has created a new generation of F1 fans in the U.S. TV ratings for the races were up 54% in 2021 over 2020, and the first two races of the 2022 season were up 47% over 2021, according to ESPN, which broadcasts the races in the U.S.
Miami organizers say many of the ticket buyers and attendees to the Grand Prix are first-time race-goers with money to burn.

The average price for Sunday’s race is $2,179 — three times the average price for the U.S. Grand Prix in Austin last year, according to online ticket seller SeatGeek. Some tickets sold for north of $7,200 each. Organizers say the prices are soaring even higher into the weekend, with hospitality packages listed on resale site StubHub for more than $25,000.
The massive race campus built around Hard Rock Stadium for the event includes a beach, dry-dock yacht marina and several VIP viewing areas. “Sand Tickets” at the Hard Rock Beach Club promise a resort-style seat for the racing action and are being offered for $1,000 a piece — “beach attire encouraged.” “Deck tickets” at the Beach Club go for $2,000.
With hundreds of thousands of fans expected, but capacity limited to about 80,000 at the race venue, local hotels, restaurants and bars will be overrun — and are charging accordingly. Event organizers project an economic impact of $400 million to the city of Miami Gardens, where the Hard Rock Stadium and track are located.
Local hotels are leaning into the luxury.
The St. Regis Bal Harbour Resort is offering a $110,000 “Diamond Package” that includes an oceanfront villa, round-trip private jets, dinner and a bespoke piece of diamond jewelry from De Beers.
The five-star Faena Hotel Miami Beach is offering its 4,500 square-foot Faena Suite for $120,000 a night during race weekend. The package includes access to the Red Bull team’s hospitality suite, which offers one of the best viewing areas of the race.
Red Bull is currently second in the F1 team standings, behind Ferrari, and boasts current World Champion Max Verstappen as one of its drivers.
The restaurant Carbone, whose parent company Major Food Group is building an empire of glitzy restaurants stretching from Las Vegas to Miami to Hong Kong, is creating a special pop-up restaurant on South Beach for the Formula 1 crowds.
It will host 200 guests a night at Carbone Beach, offering cocktails, wine, champagne, caviar, dinner prepared by chef Mario Carbone and nightly performances by surprise guests. With a price tag of $3,000 per person per night — not including tip — Zalaznick said the dinners are basically sold out.
“Honestly, I think it’s worth $6,000 per person,” Zalaznick said. “We’re way ahead of where we projected we would be.”
And the spending doesn’t stop at sundown. The nightclub E11even Miami is bringing in celebrity DJs such as Tiesto and Diplo for the week and is offering tables for between $5,000 and $100,000 per night.

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Sustainable Energy

Sustainable Energy
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“We can [adapt] … to the situation,” Herbert Diess tells CNBC. “We can, [for] a little bit, prolong our coal fired plants — hopefully it’s not for too long.
Company had been planning to replace coal-fired boilers with gas and steam turbine units, but global events appear to have prompted a rethink for the time being.
VW reported results for the first quarter of 2022 on Wednesday, with operating profit before special items hitting 513 million euros.

Covering an area of 6.5 million square meters, VW’s huge manufacturing facility in Wolfsburg uses two cogeneration plants that provide it with heat and power.
Krisztian Bocsi | Bloomberg | Getty Images

The CEO of Volkswagen told CNBC Wednesday that the German automotive giant was keeping its options open in terms of how it powers its huge manufacturing plant in Wolfsburg, admitting coal would still be needed due to ongoing tensions between Russia and Europe.
Speaking to CNBC’s Annette Weisbach, VW chief Herbert Diess was asked how concerned he was about gas supplies from Russia stopping and what that would mean for his firm’s operations.

“That’s actually really a threat … because it’s very hard to predict what’s going to happen,” Diess said. “Here in Wolfsburg we still have coal-fired power plants which we wanted to — and we are — converting into gas.”
Covering an area of 6.5 million square meters, VW’s manufacturing facility in the city of Wolfsburg uses two cogeneration plants that provide it with heat and power.
The firm had been planning to replace its coal-fired boilers with gas and steam turbine units in a bid to lower carbon dioxide emissions, but global events would appear to have prompted a rethink for the time being.
“It’s all prepared but now we are a little bit hesitating, and we will look and see how the situation is going to develop,” Diess said. “We can [adapt] … to the situation. We can, [for] a little bit, prolong our coal-fired plants — hopefully it’s not for too long. Then we would like to change to gas once the supply is secured.”
On Wednesday, Reuters also quoted Diess as telling reporters that VW had “just decided to upgrade our coal-fired power plants to still be able to use coal or gas,” adding that this related to the company’s main operations in Wolfsburg.

VW reported results for the first quarter of 2022 on Wednesday. Operating profit before special items hit 513 million euros (around $541 million), up from 490 million euros in the first quarter of 2021. The firm reported sales revenue of just under 15 billion euros compared to 17.6 billion euros in the first quarter of 2021.

Read more about clean energy from CNBC Pro

Diess’ remarks came on the same day the European Commission, the EU’s executive branch, put forward new sanctions against the Kremlin that will include a six-month phase out of Russian crude imports.
“We will phase out Russian supply of crude oil within six months and refined products by the end of the year,” Ursula von der Leyen, the European Commission’s president, said in a speech outlining the plans.
“Thus, we maximize the pressure on Russia, while at the same time – and this is important – we minimize the collateral damage to us and our partners around the globe,” she said. “Because to help Ukraine, we have to make sure that our economy remains strong.”
Russia was the biggest supplier of both petroleum oils and natural gas to the EU last year, according to Eurostat. Toward the end of April, Russia’s state-owned energy firm Gazprom stopped supplies to two EU nations, Poland and Bulgaria, because they had refused to pay for gas in rubles. The move led many to fear that other countries in the EU could see their supplies halted too.
Geopolitical instability, the volatility of energy markets and the Covid-19 pandemic have all sparked concerns in some quarters that any transition to a global economy centered around renewables could be delayed or prevented.
During an interview with “Squawk Box Europe” on Wednesday morning, the CEO of shipping giant Maersk offered a cautiously optimistic outlook.
Søren Skou said “a higher oil price, all things equal, will help the green transition because it will make the cost premiums, if you will, for greener fuels smaller.”
“So we see that more as a way of accelerating the green transition than pushing it back.”
— CNBC’s Silvia Amaro contributed to this report More

Yum Brands on Wednesday reported quarterly earnings and revenue that missed analysts’ expectations.
Lockdowns in China weighed on sales.
The company said it would fall short of its long-term forecast for core operating profit growth as it excludes Russian profits.

Vehicles wait in line at the drive through lane of a Yum! Brands Inc. Kentucky Fried Chicken (KFC) and Taco Bell restaurant in Lockport, Illinois, U.S.
Daniel Acker | Bloomberg | Getty Images

Yum Brands on Wednesday reported quarterly earnings and revenue that missed analysts’ expectations as lockdowns in China weighed on sales.
The company also said it would miss its long-term target for operating profits this year as a result of suspending Russian operations.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

Earnings per share: $1.05 adjusted vs. $1.07 expected
Revenue: $1.55 billion vs. $1.59 billion expected

Global same-store sales rose 3% in the quarter.
Yum’s KFC chain reported same-store sales growth of 3% during the period, but the company said, excluding China, same-store sales for the fried chicken chain actually climbed 10%. China is KFC’s largest market by system-wide sales. Wall Street was anticipating same-store sales growth of 4.4%, according to StreetAccount estimates.
Likewise, China also weighed on Pizza Hut’s results. The market is the pizza chain’s second-largest. Pizza Hut reported flat global same-store sales growth for the quarter. International markets, including China, saw same-store sales rise 5%.
Pizza Hut’s U.S. sales were also under pressure. The chain said same-store sales declined 6% in its home market.

Taco Bell was the only chain in Yum’s portfolio to report better-than-expected same-store sales growth, at 5% versus an expected 2.7%.
Yum opened 628 net new locations during the quarter, most of which were KFC restaurants. Digital orders accounted for more than 40% of transactions and $6 billion in system-wide sales during the quarter.
Net sales rose 4% to $1.55 billion, falling short of expectations of $1.59 billion.
The company reported first-quarter net income of $399 million, or $1.36 per share, up from $326 million, or $1.07 per share, a year earlier.
Excluding refranchising gains, profits from Russian operations and other items, the company earned $1.05 cents per share, missing the $1.07 per share expected by analysts surveyed by Refinitiv.
Yum pledged to donate net profits from its Russian operations to humanitarian efforts after the Kremlin invaded Ukraine. It also temporarily closed company-owned KFC locations in Russia and is finalizing an agreement with its Russian franchisee to suspend Pizza Hut operations in the country. Russia accounted for about 2% of Yum’s system-wide sales in 2021, and it was a key market for new restaurant development.
Due to its exclusion of Russian profits, Yum said it would fall short of its long-term target to generate high-single digit growth for its core operating profits. Instead, for 2022, it’s now anticipating core operating profit growth in the mid-single digits.
Read the full earnings report here.
This is breaking news. Please check back for updates.

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CVS Health outpaced Wall Street’s expectations for earnings and raised its guidance for the year, as it saw demand for prescriptions and more, while demand for Covid vaccines and testing declined.
Still, in the first quarter, CVS saw declining demand for pandemic-related services.
The company is focused on other ways to draw foot traffic, drum up business and stem competition from online retailers.

A CVS Pharmacy store is seen in the Manhattan borough of New York City, New York.
Shannon Stapleton | Reuters

CVS Health on Wednesday outpaced Wall Street’s expectations for first-quarter earnings and raised its guidance for the year, as it saw demand for prescriptions and more, while demand for Covid vaccines and testing declined.
The health-care company said it now expects adjusted earnings per share for 2022 to range from $8.20 to $8.40 compared with its previous forecast of between $8.10 to $8.30.

Shares were up more than 1% in premarket trading.
Here’s what the company reported for the three-month period ended March 31, compared with what analysts were expecting, based on a survey of analysts by Refinitiv:

Earnings per share: $2.22 adjusted vs. $2.15 expected
Revenue: $76.83 billion vs. $75.39 billion expected

The health-care company reported net income of $2.31 billion, or $1.74 per share, higher than the $2.22 billion, or $1.68 per share, a year earlier.
Excluding items, CVS earned $2.22 per share, more than the $2.15 per share expected by analysts surveyed by Refinitiv.
Revenue increased to $76.83 billion from $69.1 billion a year earlier. That topped/fell short of analysts’ expectations of $75.39 billion.

Customers have turned to CVS drugstores during pandemic, seeking Covid tests and vaccines. Now, the company is focused on other ways to draw foot traffic, drum up business and stem competition from online retailers. It has added more health-care services to its stores and encouraged members of its health insurance business, Aetna, to go to its drugstores for medical care.
In the first quarter, CVS saw declining demand for pandemic-related services. It administered more than 6 million Covid tests and more than 8 million Covid vaccines in the three-month period. That compares to more than 8 million Covid tests and more than 20 million Covid vaccines in the fourth quarter.
Instead of getting Covid tests at drugstores, more consumers are buying over-the-counter test kits. CVS pointed to those as a sales driver in the quarter — but did not specify how many it sold.
Same-store sales at CVS grew 10.7% in the first quarter compared to the year-ago period. In the pharmacy, same-store sales rose 10.1% and in the front store, same-store sales increased 13.2%.
CVS said it attracted new customers, filled more prescriptions and saw a more typical cough, cold and flu season in the first quarter. In the year-ago period, fewer shoppers sought medications for seasonal illnesses as they wore masks and spent more time at home. The company said it also saw sales increase from pharmacy brand inflation.
Sales increases were partially offset by the introduction of new generic drugs, reimbursement pressure in the pharmacy segment and a drop in Covid testing demand, the company said.
The company’s operating income took a hit, declining 2.4% in the quarter, due to a pending agreement between CVS and the state of Florida to settle opioid claims against the company for $484 million. That settlement will be paid over an 18-year period.
As of Tuesday’s close, shares of CVS are down about 7% so far this year, outperforming the 12% decline of the S&P 500. Shares closed Tuesday at $95.98, bringing the company’s market value to $126.04 billion.
Read the company’s press release here.
This story is developing. Please check back for updates.

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