The Financial Stability Oversight Council said Friday it discussed the ongoing annual reevaluation of its designation of a nonbank financial company -- in all likelihood, a reference to American International Group , as media reports suggested the group of regulators would ahead of the meeting. The FSOC didn't say what, if anything, was decided. If the FSOC ruled that AIG was no longer a systemically important financial institution, the insurer would no longer be subject to federal oversight via the Federal Reserve. AIG was bailed out by the federal government during the financial crisis of 2008.
Facebook Inc. will not execute a stock split that creates a non-voting class of shares after facing an investor lawsuit, Chief Executive Mark Zuckerberg announced Friday afternoon. Zuckerberg wanted the stock split to ensure he remained in control of Facebook even while donating a massive amount of his stock to an LLC he and his wife Priscilla created to support philanthropic causes. In his announcement on Facebook, Zuckerberg said the increase in Facebook's stock price allows him to avoid creating a non-voting class of stock. "Over the past year and a half, Facebook's business has performed well and the value of our stock has grown to the point that I can fully fund our philanthropy and retain voting control of Facebook for 20 years or more," Zuckerberg wrote. "As a result, I've asked our board to withdraw the proposal to reclassify our stock -- and the board has agreed." Facebook stock has increased 48.2% in 2017, pushing its market capitalization to near $500 billion, while the S&P 500 index has gained 11.7% in that time. Zuckerberg was set to testify next week in a Delaware court where investors were fighting the split, but that session was suddenly canceled Friday, amid rumors of a settlement between Facebook and investors.
U.S. stocks ended with slight moves on Friday, as the market's recent upward momentum remained intact, although geopolitical uncertainty limited buying appetite with major indexes near records. The Dow Jones Industrial Average fell 10 points, or less than 0.1%, to 22,349. The S&P 500 rose 1.5 point to 2,502. The Nasdaq Composite Index was up 4 points, or 0.1%, to 6,427. North Korea returned to the forefront after the country's foreign minister Ri Yong Ho said late Thursday at a United Nations meeting that his country might consider a nuclear bomb of "unprecedented scale" in the Pacific. While geopolitical tensions have been elevated, some analysts said the stock market has become desensitized to the threats the U.S. and North Korea. For the week, the Dow rose 0.4%, the S&P rose 0.1%, and the Nasdaq fell 0.3%. Among the day's most active stocks, CarMax Inc. rose 7.8% after quarterly earnings and revenue beat Wall Street expectations.
The beginning of third-quarter earnings reporting season is still a few weeks away, but a record number of companies have already provided revenue guidance that was above expectations, according to Senior Earnings Analyst John Butters at FactSet. FactSet has been tracking guidance since 2006. Overall, 54 companies have issued positive revenue guidance, which is more than double the five-year average of 25, and above the first-quarter 2011 record of 45, Butters said. Over half (30) of the positive revenue guidance comes for the information technology sector, followed by 11 from the consumer discretionary sector and eight from health care, FactSet data shows. Since the end of the second quarter, the SPDR Technology Select Sector ETF has climbed 7.0%, the SPDR Consumer Discretionary Select Sector ETF has eased 0.1%, the SPDR Health Care Select Sector ETF has tacked on 3.0% and the S&P 500 has gained 3.3%.
U.S. oil pricesedged up for the session on Friday and gained for a third-straight week. Major oil producers at the OPEC-led committee meeting said compliance with their production-cut agreement climbed to a record 116% in August. November West Texas Intermediate crude rose 11 cents, or 0.2%, to settle at $50.66 a barrel on the New York Mercantile Exchange. For the week, the contract tacked on 0.4%, but prices based on the front-month contracts climbed 1.5%.