Finance

Check out the companies making headlines before the bell:
General Mills (GIS) – General Mills reported adjusted quarterly earnings of $1.12 per share, 11 cents above estimates, with revenue that also topped Wall Street forecasts. The stock rose 1.6% in the premarket, even as the food producer forecast full-year profit below Street estimates amid rising costs and shifting consumer preferences toward cheaper brands.

Carnival (CCL) – The cruise line operator’s shares slid 7.8% in premarket trading after Morgan Stanley cut the price target to $7 per share from $13. Morgan Stanley said the price could potentially go to zero in the face of another demand shock, given Carnival’s debt levels. Rival cruise line stocks fell in sympathy, with Royal Caribbean (RCL) down 4% and Norwegian Cruise Line (NCLH) falling 4.6%.
Bed Bath & Beyond (BBBY) – The housewares retailer announced the departure of CEO Mark Tritton, saying it was time for a leadership change. Independent director Sue Gove will serve as interim CEO while the search for a permanent replacement is conducted. Separately, the company reported a wider-than-expected quarterly loss. Bed Bath & Beyond plummeted 10.1% in premarket action.
McCormick (MKC) – The spice maker’s stock slumped 7.3% in premarket trading after the company reported lower-than-expected quarterly results and cut its full-year outlook. McCormick said it is seeing a negative impact from factors like higher costs, supply chain issues and unfavorable foreign currency trends.
Pinterest (PINS) – Pinterest co-founder Ben Silbermann stepped down as CEO and will transition to the newly created post of executive chairman. He’ll be replaced by Bill Ready, who had been president of commerce at Google. The image-sharing company’s stock rose 2.5% in the premarket.
Nio (NIO) – Nio is denying a report by short-seller Grizzly Research that accuses the electric car maker of exaggerating its financial results. Nio said the report is without merit and contains numerous errors. Nio slumped 7% in premarket trading.

Upstart Holdings (UPST) – The cloud-based lending company’s shares tumbled 9.6% in the premarket after Morgan Stanley downgraded it to “underweight” from “equal-weight.” Morgan Stanley cites a number of factors, including deteriorating underwriting performance.
Tesla (TSLA) – Tesla is closing a Silicon Valley office and laying off 200 workers, according to people familiar with the matter who spoke to the Wall Street Journal. Tesla is in the midst of an ongoing effort to reduce headcount and cut costs. Its stock lost 1.6% in premarket action.
Walt Disney (DIS) – Walt Disney extended the contract of CEO Bob Chapek for three years, saying he has weathered many difficulties during his tenure and emerged in a position of strength.

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Brendan Carr, one of the FCC’s commissioners, shared Tuesday via Twitter a letter to Apple CEO Tim Cook and Alphabet CEO Sundar Pichai that pointed to reports and other developments that made TikTok non-compliant with the two companies’ app store policies.
Alphabet, Apple and TikTok did not immediately respond to CNBC requests for comment.
Carr’s letter, dated June 24 on FCC letterhead, said if the Apple and Alphabet do not remove TikTok from their app stores, they should provide statements to him by July 8.

A leader of the U.S. Federal Communications Commission said he has asked Apple and Google to remove TikTok from their app stores over data security concerns. Pictured here is the TikTok download page on an Apple iPhone on August 7, 2020.
Drew Angerer | Getty Images News | Getty Images

BEIJING — A leader of the U.S. Federal Communications Commission said he has asked Apple and Google to remove TikTok from their app stores over China-related data security concerns.
The wildly popular short video app is owned by Chinese company ByteDance, which faced U.S. scrutiny under President Donald Trump.

Brendan Carr, one of the FCC’s commissioners, shared via Twitter a letter to Apple CEO Tim Cook and Alphabet CEO Sundar Pichai. The letter pointed to reports and other developments that made TikTok non-compliant with the two companies’ app store policies.
“TikTok is not what it appears to be on the surface. It is not just an app for sharing funny videos or meme. That’s the sheep’s clothing,” he said in the letter. “At its core, TikTok functions as a sophisticated surveillance tool that harvests extensive amounts of personal and sensitive data.”
Alphabet, Apple and TikTok did not immediately respond to CNBC requests for comment.
Carr’s letter, dated June 24 on FCC letterhead, said if the Apple and Alphabet do not remove TikTok from their app stores, they should provide statements to him by July 8.
The statements should explain “the basis for your company’s conclusion that the surreptitious access of private and sensitive U.S. user data by persons located in Beijing, coupled with TikTok’s pattern of misleading representations and conduct, does not run afoul of any of your app store policies,” he said.

Trump nominated Carr in 2018 to a five-year term with the FCC. The Senate confirmed in December that the commission’s chair, Jessica Rosenworcel, would stay on for another five-year term.
Carr’s letter cited a BuzzFeed News report from earlier in the month that said recordings of TikTok employee statements indicated engineers in China had access to U.S. data between September 2021 and January 2022.

The BuzzFeed report included a statement from a TikTok spokesperson.
It said: “We know we’re among the most scrutinized platforms from a security standpoint, and we aim to remove any doubt about the security of US user data. That’s why we hire experts in their fields, continually work to validate our security standards, and bring in reputable, independent third parties to test our defenses.”
On June 17, the same day as the BuzzFeed report, TikTok announced it was routing all of U.S. user traffic to Oracle Cloud Infrastructure, and was moving U.S. users’ private data from its own data centers in the U.S. and Singapore to Oracle cloud servers in the U.S.

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Chinese businesses ranging from services to manufacturing reported a slowdown in the second quarter from the first, reflecting the prolonged impact of Covid controls.
That’s according to the U.S.-based China Beige Book, which claims to have conducted more than 4,300 interviews in China in late April and the month ended June 15.
The analysis found few signs that government stimulus was having much of an effect yet.

China’s exports surged by 16.9% in May from a year ago, two times faster than analysts expected. Pictured here on June 15, 2022, are workers in Jiangsu province making stuffed toy bears for export.
Si Wei | Visual China Group | Getty Images

BEIJING — Chinese businesses ranging from services to manufacturing reported a slowdown in the second quarter from the first, reflecting the prolonged impact of Covid controls.
That’s according to the U.S.-based China Beige Book, which claims to have conducted more than 4,300 interviews in China in late April and the month ended June 15.

“While most high-profile lockdowns were relaxed in May, June data do not show the powerhouse bounce-back most expected,” according to a report released Tuesday. The analysis found few signs that government stimulus was having much of an effect yet.
Shanghai, China’s largest city by gross domestic product, was locked down in April and May. Beijing and other parts of the country also imposed some level of Covid controls to contain mainland China’s worst outbreak of the virus since the pandemic’s initial shock in early 2020.
In late May, Chinese Premier Li Keqiang held an unprecedentedly massive videoconference in which he called on officials to “work hard” — for growth in the second quarter and a drop in unemployment.

Transportation, construction companies aren’t telling you they’re getting new products. They’re telling you they’ve slowed investment, their new projects have actually slowed.

Shehzad H. Qazi
Managing Director, China Beige Book

Between the first and second quarters, hiring declined across all manufacturing sectors except for food and beverage processing, according to the China Beige Book report.
The employment situation likely won’t start to improve until China stimulates its economy more in the fall, China Beige Book Managing Director Shehzad H. Qazi said Wednesday on CNBC’s “Squawk Box Asia.”

So far, there’s been little sign that stimulus has kicked in, especially in infrastructure, said Qazi who is based in New York.
“Transportation, construction companies aren’t telling you they’re getting new products,” he said. “They’re telling you they’ve slowed investment, their new projects have actually slowed.”

Inventories surge, orders drop

Unsold goods piled up, except in autos. Orders for domestic consumption and overseas export mostly fell in the second quarter from the first. Orders for textiles and chemicals processing were among the hardest-hit.
The only standout domestically was IT and consumer electronics, which saw orders rise during that time. Orders for export grew in three of seven manufacturing categories: electronics, automotive and food and beverage processing.

“Weak domestic orders and expanding inventories indicate the presumed second-half improvement will be unpleasantly modest,” the report said.
The authors noted the services sector saw the greatest reversal. After accelerating in growth in the first quarter, services businesses saw revenue, sales volumes, capex and profits drop in the second quarter.
Across China, only the property sector and the manufacturing hub of Guangdong saw any year-on-year improvement, the China Beige Book said.
Official second-quarter gross domestic product figures are due out July 15. GDP grew by 4.8% in the first quarter from a year ago.

Read more about China from CNBC Pro

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Stock futures were flat in overnight trading Tuesday after the major averages made a failed attempt at a bounce.
Futures tied to the Dow Jones Industrial Average edge 0.13% or 39 points, while the S&P 500 and the Nasdaq Composite rose 0.13% and 0.17%, respectively.

Pinterest shares jumped more than 4% after hours on news that CEO Ben Silbermann is stepping down.
During regular trading on Tuesday the Dow Jones Industrial Average dropped 491.27 points, or 1.56%, to 30,946.99, while the S&P 500 slid 2.01% to 3,821.55. The Nasdaq Composite fell 3% to 11,181.54.
Major averages rallied earlier in the session, with the Dow and S&P 500 up as much as 446 points and 1.17%, respectively. Markets gave up those gains following a disappointing consumer confidence index reading, which came in at 98.7 and missed Dow Jones’ estimate of 100. The moves followed slight losses in Monday’s session after the averages posted their best week for June last week.
As the second quarter comes to an end on Thursday, there are rising recession fears. Concern over a slowing economy and aggressive rate hikes consumed much of the first half of 2022 as investors continue to search for a bottom to a vicious market sell-off.

Stock picks and investing trends from CNBC Pro:

The S&P 500, which is down about 20% in 2022, is on pace for its worst first half of the year since 1970, when the index lost 21.01%. Meanwhile, on a quarterly basis, both the Dow and S&P 500 are on track for their worst performance since 2020. The Nasdaq is headed toward its worst three-month period since 2008.

All the major averages ended Tuesday’s session in the negative, except for energy, which rose 2.7% as oil prices rallied.
Just three Dow stocks ended the day higher, with the losses led by Nike. Shares of the sportswear company fell 7% after it warned that higher transportation costs and shipping delays would likely persist.
Beaten-up chip stocks Nvidia and Advanced Micro Devices ended the day more than 6% lower while big technology names including Netflix, Amazon and Meta Platforms closed down about 5% each.
“As long as the sell-off is orderly,” the Fed is “not concerned with the level of stock prices,” Guggenheim Partners’ Global CIO Scott Minerd told CNBC’s “Closing Bell: Overtime” on Tuesday. “The bottom line is until we see some amount of panic here or something that gets the central bankers concerned, they are just ‘hellbent’ to get inflation under control.”
Investors on Tuesday continued to keep a close eye on China, which eased Covid restrictions for inbound travelers and slashed quarantine time to seven days. Casino stocks Wynn Resorts and Las Vegas Sands moved higher on the news.
On Wednesday, investors are looking ahead to comments from Federal Reserve Chairman Jerome Powell at the European Central Bank forum. Earnings from Bed Bath & Beyond, General Mills and McCormick are also on deck.

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Disney store is seen in Times Square, New York City.
Nick Pfosi | Reuters

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Companies such as Tesla and Coinbase have announced layoffs, and there are signs of impending cuts on Wall Street. A U.S. recession would add to the toll.
Here are some key financial moves for workers to make after losing a job.

Halfpoint Images | Moment | Getty Images

1. Take a financial inventory

Among the first things to do if you lose your job is take stock of financial resources at your disposal, according to financial advisors.
Those may include other streams of income such as a partner’s salary, as well as emergency savings, company stock and financial accounts including a 401(k) or individual retirement account (more on this in a bit).
Your resources may also include company benefits like severance pay or cashing out unused leave like vacation and sick days. Workers should also check to see if they can continue receiving benefits like company-sponsored health and life insurance.

Households should also update their budgets to get a sense of current spending and how that could be adjusted without your paycheck.
“You want to get clarity,” said financial advisor Winnie Sun, co-founder of Sun Group Wealth Partners in Irvine, California, and a member of CNBC’s Advisor Council. “We all think we don’t spend that much.
“But most of us probably do.”
These factors — your budget and money stash — will help dictate your timeline for finding a new job.

2. Apply for unemployment insurance

Unemployment insurance may also factor into your cash flow.
Benefit amount and duration vary widely among states and also depend on factors like your earnings and work history. The average person collected about $363 a week over the 12 months through April 2022, according to the U.S. Department of Labor.
Workers should apply right away (generally online or by phone) after a layoff, even if they think they’re not eligible, Nightingale said.
Applicants generally submit a claim for benefits in the state where they worked, according to the Labor Department. You can consult the DOL’s state directory or CareerOneStop.org for agency contact and application information.

Further, be prepared with relevant information like employment records for about the past two years, Nightingale said.
“Don’t just pick up the phone and say, ‘I was working at XYZ Company,’ because you need more than that to apply,” she said.
You may not be immediately eligible for unemployment insurance if you’re receiving severance pay. But you may be eligible for full or partial benefits depending on your individual circumstance and state rules. If you’re deemed ineligible, file a new claim once severance pay stops.

3. Negotiate your exit

There may be some wiggle room to negotiate on severance and other company benefits, Sun said. (Not all businesses offer severance, though.)
If you are in good standing with your company, ask your manager if you can get a few extra months of severance pay, and an associated extension to medical and dental benefits.
Or, similarly, ask if you can extend your employment (and delay the layoff) by a few months. This becomes especially important if you’re close to being — but aren’t yet — fully vested in benefits like a 401(k) match or company stock, Sun said.

Typically, those who try get something.

Winnie Sun
co-founder of Sun Group Wealth Partners

There may also be room to negotiate staying on part-time or as a freelancer — which may be particularly important for workers closer to retirement age who aren’t confident they’ll be able to find another job quickly, Sun said.
“At this point, what’s the worst thing that’ll happen to you?” Sun said. “Typically, those who try get something.”

4. Figure out which assets to tap, in what order

Knowing where to draw money from can be a delicate balancing act, due to potential tax consequences.
If you need to pull from financial accounts, cash from an emergency fund — if you have one — will generally be your first choice, according to financial advisors.
Savers with Roth IRAs can typically withdraw their account contributions tax- and penalty-free. (That’s not true of investment earnings, though. Some limitations may also apply to pre-tax IRA contributions that were subsequently converted to Roth IRA funds.)
Roth 401(k) accountholders can also pull out money tax- and penalty-free, under two conditions: The owner must be over 59½ years old and made a contribution at least five tax years ago.

Those with long-term investments (held for more than a year) in taxable brokerage accounts can sell them for income at a preferential tax rate.
Tax-deferred accounts like a pre-tax 401(k) or IRA should generally be a last resort, according to Ivory Johnson, a certified financial planner and founder of Delancey Wealth Management, based in Washington.
Workers would owe income tax on that distribution, and those under age 59½ would pay an additional penalty. One exception: The “Rule of 55” allows a laid-off worker who’s at least 55 years old to withdraw 401(k) funds without that 10% early-withdrawal penalty.
“You may be someone who always said, ‘I’ll never withdraw those retirement contributions,'” said Kevin Mahoney, CFP, founder and CEO of Illumint, based in Washington. “But under certain circumstances, that’s the most prudent move to make.”

5. Network and build job skills

10’000 Hours | Digitalvision | Getty Images

It’s a given you should update your resume when looking for a new job. But make sure you have different versions depending on the type of job you want, since targeting will help you stand out, Nightingale said.
Leverage your personal and professional networks to find opportunities — perhaps a union membership, professional association, business contacts, former colleagues, and friends and relatives. Connect with people on LinkedIn and ask for public endorsements, Sun said.
Further, local job services offices offer free employment and training resources. There are about 2,500 offices around the country, Nightingale said. You can find a local office and other job resources at CareerOneStop.org.
Those with free time may wish to get a certificate or acquire a new professional skill, said Johnson, a member of CNBC’s Advisor Council.
“Use your time wisely,” he said. “It shows employers you weren’t just sitting around, you were trying to get better.”

6. Take a deep breath

Lastly, don’t be too hard on yourself. Recognize that layoffs are often due to factors beyond an individual’s control instead of a personal failure.
Take a deep breath. Use your available time to step back and reflect on your career — what’s important to you? Would you like to try something new?
“Life is a long-term race, not a sprint,” Johnson said. “Sometimes it’s really a blessing to get laid off” even though it may not seem that way right now, he added.

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Rainbow flags celebrate Pride Month in New York.
Lev Radin | Pacific Press | LightRocket | Getty Images

Members of the LGBTQIA+ community are still struggling, in some instances, to access financial services that would help them manage their money.
Some 30% of LGBTQIA+ adults have experienced bias, discrimination or exclusion in the financial services sector, either from individuals or organizations, a survey from the National Endowment for Financial Education found. The online survey of more than 1,000 adults in the LGBTQ+ community took place from May 6 to May 17.

Of those who experienced such barriers to accessing financial services, many noted that age and orientation were the top reasons they felt led to the experience. In addition, transgender respondents face the most discrimination, the survey found.
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“As a member of the LGBTQIA+ community who has personally experienced many layers of bias within financial services, this issue hits close to home,” said Billy Hensley, president and CEO of the National Endowment for Financial Education, in an email.
“I think it’s easier to ignore the subjugation, prejudice, bias, phobias and ‘isms’ that happen within personal finance if we cater to the assumption that financial and social advancement rests solely on the individual’s decisions as measured only by financial outcomes,” Hensley said. “If we average everyone together, we ignore the authentic, unique and diverse lived experiences of all.”
He added that these experiences further hinder the wealth of a group that’s been historically marginalized in the U.S.

“While not specific to this data, we do know that among gender, people of color and those in the LGBTQIA+ community, there are barriers toward building wealth and income disparity that certainly factor into establishing a level playing field for financial well-being,” he said.

What can be done

In addition to feeling unwelcome in the financial services industry, nearly 40% of those surveyed said they were discouraged by how financial services were marketed or offered, meaning fee structures, applications or approval requirements kept them from seeking money help.
The report found that while roughly half of LGBTQIA+ respondents said the quality of their financial life is what they expected, about 39% said it’s worse than they anticipated. In addition, 60% are living paycheck to paycheck, according to the report.
This can be helpful data to financial services providers such as banks, insurance companies and more. In addition to providing inclusive environments for all, they can review these other barriers to entry.

“Representation is key,” said Hensley. “We need greater national awareness of just how often discrimination, bias and exclusion takes place among all populations.” He added that a greater understanding of the current landscape is attainable with better data to inform positive public policy and regulation.
There’s also a financial incentive for banks, insurance companies and other financial services firms to be more inclusive. Today, more Americans than ever before identify as LGBTQIA+ and the demographic represents one of the fastest-growing population segments, according to census data. In addition, the community has close to $1.4 trillion in spending power, according to The Pride Co-op, a LGBTQ-focused market research and intelligence agency.
“When you restrict the ability of anyone to participate in the economy fully and fairly, you prohibit them from living their best financial life,” said Hensley. “It also negatively impacts the economic health of the country.”
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Ark Invest CEO Cathie Wood said Tuesday that the U.S. is already in an economic downturn, and she admitted that she underestimated the severity and lasting power of inflation.
“We think we are in a recession,” Wood said on CNBC’s “Squawk Box” Tuesday. “We think a big problem out there is inventories… the increase of which I’ve never seen this large in my career. I’ve been around for 45 years.”

The innovation-focused investor said inflation has turned out to be hotter than she had expected due to supply chain disruptions and geopolitical risks.
“We were wrong on one thing and that was inflation being as sustained as it has been,” Wood said. “Supply chain … Can’t believe it’s taking more than two years and Russia’s invasion of Ukraine of course we couldn’t have seen that. Inflation has been a bigger problem but it has set us up for deflation.”
Inflation measured by the consumer price index rose 8.6% in May from a year ago, the fastest increase since December 1981.
Wood said consumers are feeling the rapid price increases, reflected in sentiment data that’s fallen to record lows. She pointed to the University of Michigan’s Surveys of Consumers, which showed a reading of 50 in June, the lowest level ever.
The popular investor has had a tough 2022 as her disruptive technology darlings have been among the biggest losers this year in the face of rising interest rates. Her flagship active fund Ark Innovation ETF (ARKK) is down a whopping 52% year to date, falling 66% from its record high set in February 2021.

Still, Wood said her clients are mostly sticking with her and new money is coming in as investors seek diversification in a down market. ARKK has had more than $180 million in inflows in June, according to FactSet.
“I think the inflows are happening because our clients have been diversifying away from broad-based bench marks like the Nasdaq 100,” Wood said. “We are dedicated completely to disruptive innovation. Innovation solves problems.”

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