🍟 Ukraine’s McRecovery

Tuesday, September 20, 2022 by Robinhood Snacks |
Golden arches. Blue-and-yellow flags. (Yurii Stefanyak/Getty Images)

Golden arches. Blue-and-yellow flags. (Yurii Stefanyak/Getty Images)

Golden arches. Blue-and-yellow flags. (Yurii Stefanyak/Getty Images)

Golden arches. Blue-and-yellow flags. (Yurii Stefanyak/Getty Images)

Yesterday’s Market Moves
Dow Jones
31,020 (+0.64%)
S&P 500
3,900 (+0.69%)
Nasdaq
11,535 (+0.76%)
Bitcoin
$19,514 (+0.50%)

Hey Snackers,

Honda just shifted its employee comp into reverse: the carmaker is clawing back some bonuses paid to hundreds of employees after overpayment. Oops.

The major US indexes closed up yesterday, partially recovering from last week's inflation-driven decline. All eyes are now on the Fed, which is expected to announce an interest-rate hike of 75 basis points tomorrow.

McRecovery

A tiny taste of normal… Starting today, McDonald’s will begin reopening some of its restaurants in Ukraine. McD’s closed all of its 109 locations there after Russia invaded over six months ago. (Refresher: McD’s sold its Russian stores in May and they reopened in June under new ownership.) Today, war’s still raging in Ukraine, but McDonald’s says it hopes to restore “a small but important sense of normalcy.”

  • Taking it slow: McD’s plans to open restaurants gradually over the next two months in Kyiv, where Nike and KFC stores are open. For now, Big Macs are delivery only, with in-store dining and drive-thru set to resume next month.
  • Safety first: McD’s will close during air-raid alerts to allow customers and workers to move to shelters.

The violence is ongoing… but Ukraine's already planning for recovery. Russia’s war on Ukraine has left tens of thousands of people dead, in addition to at least 7M refugees and $100B+ in damage — and it’s not over. But last week, Ukrainian President Zelensky met with BlackRock CEO Larry Fink to discuss a reconstruction fund to attract public and private investment.

  • Donations won’t do it: So far, countries have pledged $83B+ in aid to Ukraine, but some analysts say rebuilding could cost as much as $750B. To encourage private investment, Ukraine’s offering entrepreneurs grants and no-interest loans.
THE TAKEAWAY

Recovering from war takes a global effort… and McD’s and BlackRock aim to play a part. Ukraine’s economy is set to fall about 30% this year, but it didn’t collapse as Russia wanted: industry’s rebounding and unemployment’s falling. Plus, the same countries and companies pushing Russia out of the global economy are pulling Ukraine in: creditors including the US government and BlackRock have agreed to freeze billions in debt to kick-start recovery.

GTA

Grand Theft IP... Video-game titan Take-Two Interactive is feeling the heat as it suffers from one of the biggest leaks in gaming history. Over the weekend a hacker posted 90 previously unreleased clips from Take-Two's highly anticipated "Grand Theft Auto VI," including new locations and characters. Yesterday Take-Two's stock dropped 3% before rebounding higher — but is still down almost 30% this year.

  • Pause: GTA's publisher, Rockstar Games, confirmed the leaked videos are real and is trying to stop their spread on sites like YouTube.
  • Play: "GTA V" is still one of the best-selling video games ever, despite being released nearly a decade ago.

Ready player none… Take-Two's GTA hack kicks the video-game biz (which is on pace for its first sales decline in seven years) while it's down. Cyberattacks on gaming companies and users have increased 167% over the past year, as hackers look for more ways to exploit the multibillion-dollar industry. Leaks could be just the start: in July hackers posted stolen documents from Roblox in an attempt to extort the biz.

THE TAKEAWAY

It’s hard to put the IP genie back in the bottle… Gaming companies are famous for keeping releases secret. While leaks can sometimes boost hype, they can also force developers (like Take-Two and Rockstar) to make changes to games and delay releases. And delays = lost $$. "GTA VI" is expected to earn $3.5B in bookings on its 2025 debut, and $2B a year after that.

What else we’re Snackin’

  • Infloation: The Suez Canal will raise fees for passing ships by up to 15% next year because of inflation — and economists say the hike will further fuel inflation. Turns out rising inflation lifts all prices.
  • Astronight: Check in for space-tourism liftoff. Hilton says it’ll design hospitality suites and sleep spaces for Starlab, a private space station being crafted by Voyager and Lockheed Martin.
  • Checkout: Wegmans says it’ll no longer use self-checkout tech. The East Coast supermarket chain says its self-checkout app made shoplifting easier. Meanwhile, rival Amazon is leaning into checkout-free tech.
  • RTO: Employers are gaining ground on bringing workers back to the office. Now 47.5% of those who worked in an office prepandemic are back at their desks — the highest level of the pandemic so far.
  • Cold: After Russia cut gas to Europe, high energy prices are forcing European factories to slash output and furlough workers. EU production (think: metal, paper, fertilizer) fell 2%+ in July from a year ago.

Snack Fact of the Day

Scientists estimate there are 20 quadrillion (that's 20,000 trillion) ants on Earth

Tuesday

  • Earnings expected from Stitch Fix and Aurora Cannabis

Authors of this Snacks own: shares of Take-Two Interactive and Amazon

ID: 2432963