- __[HitTok](https://snacks.robinhood.com/newsletters/4gOzlWfuufbhkgNYnGBQA1/articles/6WbU0NDw8OQzavUs2zgGWp/):__ From __Sony__ to __Universal Music__, the largest record labels want a bigger cut from __TikTok__ as the app becomes a hit-maker. While TikTok needs the music industry, the industry increasingly needs the Tok.
- __[iSag](https://snacks.robinhood.com/newsletters/1rIPKyj7VdAtV8FpwShSUE/articles/gRGR2FVnkico17JfZqUlQ/):__ __Apple's__ expecting a drop in iPhone shipments this holiday season (picture: 3M fewer iPhone 14s than anticipated). Last week, China’s Covid policy triggered a weeklong shutdown at the main iPhone assembly site. 
- __[Alexa](https://snacks.robinhood.com/newsletters/4sSb6rTTRHcOl77ZhrZz2R/articles/4s4UBkKJDUcEfl5DFMLZsx/):__ __Amazon's__ reportedly looking to cut costs, and Alexa could get downsized. But instead of __Meta__-sized layoffs, Amazon is said to be pushing workers to find roles in more lucrative divisions of the company.

ICYMI

Ian Redman

Last week's highlights...

__The midterm hangover…__ isn’t over. It’s still too close to call, but the US might get a split government, with one GOP-controlled chamber of Congress. Stocks plunged Wednesday after midterm results didn’t show clear gridlock. Investors generally prefer when power’s shared, because historically that’s meant less legislation (it’s harder to agree on things). That can mean fewer potential blockers for business, regardless of which party’s in power. 

- __Democrats maintained__ their slim majority in the Senate after key victories in Nevada and Arizona over the weekend. Georgia’s runoff election is slated for December 6. 
- __If Republicans take the House__ (which they’re favored to) that’s enough to unlock gridlock. Either way, majorities will likely be slim within both chambers.  

__Ballot bubbles giving SAT flashbacks…__ From choosing lawmakers to voting on propositions, Americans’ ballot decisions could have big implications. A few sectors that could be affected:

- __Energy:__ Republican lawmakers have supported US energy independence, and that could lead to easier access to drilling permits if the GOP takes the House. 
- __Cannabis:__ Voters in Maryland and Missouri legalized recreational marijuana, joining 19 other states and DC. Meanwhile, Colorado voted to decriminalize and regulate some psychedelic substances (think: magic mushrooms). 
- __EVs:__ California voted down an extra tax to build EV infrastructure. __[Lyft](https://robinhood.com/stocks/LYFT/)__ was the biggest backer of the prop, since the funds would’ve helped it meet the state’s requirements. 
- __Gambling:__ CA voters also struck down a prop that would’ve allowed gambling companies like __FanDuel__ and __[DraftKings](https://robinhood.com/stocks/DKNG/)__ to offer online sports betting.
- __Tobacco:__ And CA became the largest state to ban flavored-tobacco products after voters upheld the state’s ban. Tobacco titans like __[Philip Morris](https://robinhood.com/stocks/PM/)__ and __[RJ Reynolds](https://robinhood.com/stocks/RAI/)__ had spent big in hopes of overturning it.

Wall Street’s waiting (Kena Betancur/Getty Images)

Voted

__Investors care more about the Fed right now…__ Because the central bank has the levers to influence rates and inflation. Inflation was voters’ [most pressing](https://www.npr.org/2022/11/07/1134832876/inflation-is-top-issue-in-this-weeks-midterms) issue in these elections (two years ago it wasn’t on the radar). Markets rallied hard Thursday after news that inflation cooled more than expected last month, which suggests the Fed might slow its rate hikes (top of mind for investors).

How midterms could affect the markets, from inflation to energy to cannabis

__Major whiplash…__ Crypto exchange __FTX__ (including FTX US and 130 affiliated companies) filed for bankruptcy Friday after a whirlwind week revealed an $8B balance-sheet hole — and rival __Binance__ bailed on its takeover plan. Oh, *and* FTX halted customer withdrawals — but that didn’t stop $515M from being moved out of the exchange Friday night in a possible hack. Sam Bankman-Fried, the exchange's now former CEO, had been a Capitol Hill regular lobbying for industry-friendly regs. Now, that regulation's in doubt. Meanwhile, investors fear FTX's "contagion" could spread. One sign that it may have already: __BlockFi__ (which got bailed out by FTX in June) suspended withdrawals, citing FTX's downfall. 

__Googling “packing hacks”...__ to avoid the $50 luggage fee. Budget airlines are booming as more travelers turn to no-frill flights to hit the inflated skies. Last week, Irish airline __Ryanair__ reported record passengers and profits for its summer quarter. Meanwhile, US-based __Frontier__ saw sales jump 35% as passengers paid extra for perks (think: bearable legroom). Travel is still hot: even with airfare forecast to be the priciest in five years, half of Americans plan to travel this holiday season.

Zoom Out

Stories we’re watching...

__Xi Jinping saw his shadow…__ and Chinese stocks may have six more weeks of winter. China’s tech giants posted their slowest growth *ever* in August as Beijing’s zero-Covid policy raised costs and hurt demand (because: more lockdowns). Chinese stocks popped this month on reopening rumors. But as Covid cases surged last week hawkish President Xi said he planned to “hold fast” to the strict policy (though he relaxed *some* rules on Friday). We’ll see how wounded giants __Alibaba__, __JD.com__, and __Tencent Music__ are faring when they report this week.

__Jingle bells in November…__ Retailers are getting into the holiday spirit early. __Walmart’s__ sales jumped 8% last quarter, but profits were squeezed as inflation-fatigued shoppers avoided big-ticket items like TVs. __Target’s__ profits fell 90% as it offered steeper discounts on overstocked goods. Still, holiday sales are expected to rise from last year, and retailers are already setting up festive displays to hype demand. But an unmerry combo of discounts and high costs could keep Walmart and Target from wowing investors when they report this week.

Events

Coming up this week...

Dow Jones

S&P 500

Nasdaq

Bitcoin

China is nearly as wide as the US, but the entire country officially has just one time zone

Last week's highlights...

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