Warner Bros Discovery Inc (NASDAQ: WBD) announced plans to split its cable networks from its streaming and studio operations on Thursday.

Shares of the mass media behemoth are up 15% at writing.

“We continue to prioritise ensuring our Global Linear Networks business is well positioned to continue to drive free cash flow, while our Streaming & Studios business focuses on driving growth,” David Zaslav – the company’s chief executive said in a statement today.

WBD expects the restructuring to be complete before the second half of 2025. Its share price is now up more than 85% versus its low in August.

Restructuring opens doors for future deals

Warner Bros Discovery expects a simpler business structure that highlights the value of each division to make it more attractive for potential deals or acquisitions.

Creating distinct linear and streaming divisions will enable the management to devise more targeted strategies and operational efficiencies that help each segment realise its true potential.

The announcement arrives at a time when the TV business more broadly is scrambling to win advertising dollars amidst a continued decline in subscribers.

Last month, peer Comcast also announced plans to separate its cable networks amidst a mass exodus of customers from its TV business.

However, the company’s spin-off plans have failed to boost its stock price in recent weeks.

Warner Bros Discovery to play offense and defense

WBD wants to restructure into a distinct linear division and a more profitable streaming business also because it will offer clearer visibility into the performance and profitability of each segment.

The transparency is typically valuable for investors as well as international decision-making.

Warner Bros Discovery’s two-division strategy will enable it to play both offense and defense. The TV business will serve as its cash cow, helping lower debt on its balance sheet – while the streaming unit will commit to growth.

All in all, the move could improve WBD’s strategic options, including a potential merger, spin-off, or other notable plays aimed at creating additional shareholder value.

That’s why investors are reacting positively to the news as evidenced in a 15% stock price rally today.  

Is there any upside left in WBD stock?

Part of the recent strength in Warner Bros Discovery stock has been related to a multi-year distribution agreement it signed with Xfinity in the US and Sky in the United Kingdom.

The agreement sets the stage for its Max streaming service to launch in Europe.

So, it looks like the stars are aligning well for WBD. That’s why analysts at Benchmark continue to see an upside in its shares to $18.

Their price target indicates potential for another 45% upside from current levels. WBD stock does not, however, pay a dividend in writing.

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A sense of unease has washed over European stock futures, mirroring a downturn in Asian markets.

This synchronized slide comes in the wake of a Chinese economic conference that failed to ignite the hoped-for investor enthusiasm.

The meeting, which was expected to reveal fiscal stimulus details, left the markets wanting, particularly in its lack of specifics regarding consumption boosts.

As traders recalibrate, risk appetite has notably weakened, casting a shadow over the week’s financial landscape.

Euro Stoxx 50 contracts fell by 0.2%, with the global stock barometer on track to record its most significant weekly drop in nearly a month.

This decline is compounded by the fact that S&P 500 index contracts only saw a slight uptick on Friday following Thursday’s Wall Street sell-off, fueled by concerns over US jobless claims and producer price data.

China’s ambiguous signals and bond market tumult

The economic landscape in Asia was particularly turbulent.

China and Hong Kong’s stock markets led regional declines, as the Central Economic Work Conference concluded without unveiling concrete fiscal stimulus plans, despite the government’s promise to bolster consumption.

While the commitment to lowering policy rates and banks’ reserve ratios was made, the move triggered an unprecedented slide in Chinese 10-year government bonds, falling below 1.8% for the first time in history.

Jason Chan, Senior Investment Strategist at Bank of East Asia, told Bloomberg, “The market may have some hope that the CEWC would give more details on consumption stimulus and property inventory clearance packages, but the turnout was a bit disappointing. Investors may need to wait for more fiscal policy rollout in the first quarter.”

Dollar strength and mixed signals from global economies

The dollar index remained stable, holding onto gains accumulated over the previous five sessions, bolstered by rising Treasury yields.

This surge in the dollar’s value reflects a broader market sentiment shaped by varied economic indicators.

In Japan, confidence among large corporations remained high, which broadly aligned with the Bank of Japan’s stance ahead of its next policy meeting.

However, analysts remain divided on the probability of an impending rate hike.

Meanwhile, South Korea’s equity benchmark saw a momentary recovery following President Yoon Suk Yeol’s failed attempt to impose martial law.

A report from local newspaper Munhwa Ilbo suggested that more than eight members of the ruling People Power Party support Yoon’s impeachment, the minimum number needed for approval.

In a somewhat more sobering turn, shares of DigiCo Infrastructure REIT plummeted as much as 10% on their Sydney debut, attributed to valuation concerns.

Adding to the patchwork of global economic narratives, Indian government data revealed that the country’s inflation had cooled last month, providing a sigh of relief to its newly appointed central bank chief.

Central banks and the rate cut jigsaw puzzle

The narrative of global financial markets is further complicated by the varied actions of central banks.

The European Central Bank, aligning with expectations, trimmed borrowing costs by 25 basis points, signaling further cuts in future meetings.

The Swiss National Bank went a step further, implementing a more substantial 50 basis point cut, outpacing market forecasts.

On the other hand, the US economic data released on Thursday presented a muddled picture of the American economy.

Although jobless claims rose more than anticipated, producer price data gave mixed signals.

US wholesale inflation accelerated in November, due to the steep rise in egg prices, a rather unusual factor.

Despite this confusing mix of data, expectations for a US rate cut next week remained steadfast.

Swap market pricing showed that a 95% level of confidence exists that the central bank will reduce borrowing costs by 25 basis points at its December meeting.

Commodities in the crosshairs: oil, gold, and Bitcoin

The commodities market saw its own share of drama.

Oil prices are on track for a weekly advance, as concerns about stricter US sanctions against Iran and Russia offset worries about a looming global glut next year.

Gold prices rebounded, partially recovering from a 1.4% drop on Thursday.

Bitcoin continues to make headlines, trading around the $100,000 mark, further underscoring the volatility and fascination surrounding the cryptocurrency markets.

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Indian equity markets witnessed a steep sell-off on Friday, with the benchmark indices Sensex and Nifty shedding over 1%.

The Sensex dropped 1,147 points, or 1.41%, to 80,142, while the Nifty50 lost 337 points, or 1.37%, touching 24,211, as of 10:35 am, India time.

Investors were spooked by weak global cues, higher domestic inflation, and persistent uncertainty over China’s economic stimulus measures.

The sell-off wiped ₹6.5 lakh crore from the total market capitalization of BSE-listed companies, now at ₹451.65 lakh crore.

Interest rate-sensitive sectors also saw significant losses.

The Nifty Bank, Auto, Financial Services, PSU Bank, and Realty indices dropped between 1.5% and 2.7%.

Meanwhile, India VIX, a measure of market volatility, spiked 9.9% to 14.5, signalling heightened investor anxiety.

China stimulus ambiguity drags down metal stocks

The Nifty Metal Index was the worst performer of the day, slumping 5% as uncertainty loomed over China’s economic policies.

Steel Authority of India (SAIL) and NMDC led the decline with over 4% losses, while Tata Steel, JSW Steel, and Hindustan Copper shed more than 2%.

China, a key driver of global metal demand, has signaled potential economic stimulus, including interest rate cuts and adjustments to banks’ reserve requirements.

However, the lack of clarity on the timing and scale of these measures has dampened investor sentiment, triggering profit booking across metal stocks.

“The metal rally seen after China’s initial stimulus announcements in September has fizzled out as the broader market sentiment remains weak,” said Gaurang Shah, Head Investment Strategist at Geojit Financial Services.

Rising inflation adds to market pressure

India’s retail inflation eased to 5.48% in November, falling within the Reserve Bank of India’s (RBI) target range.

However, rural inflation surged to 9.10% from 6.68% in October, and urban inflation rose to 8.74% from 5.62%.

The spike in inflation levels, particularly in rural areas, has raised concerns over its potential impact on monetary policy decisions.

Higher inflation could compel the RBI to maintain a cautious stance in its upcoming policy review, potentially delaying rate cuts that many investors are hoping for.

Stronger dollar deters foreign investments

The US dollar continued its ascent, with the dollar index rising 0.13% to 107.1.

A stronger dollar erodes the attractiveness of emerging markets like India, as it increases the cost of foreign debt and reduces the appeal of local equities.

“The rising dollar is a concern since it can lead to imported inflation,” said Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Outlook remains cautious

The combination of global uncertainty, domestic inflation concerns, and weak metal demand has created a challenging environment for Indian markets.

While some relief could come from clarity on China’s economic policies, analysts expect near-term volatility to persist.

“Investor confidence may only return with tangible stimulus measures from China and a clear signal from the RBI on interest rates,” said Jeff Ng, Head of Asia Macro Strategy at Sumitomo Mitsui Banking Corporation.

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ServiceTitan made a blockbuster debut on the Nasdaq Stock Exchange on Thursday.

Shares opened more than 40% up compared to their initial public offering (IPO) price of $71 and stuck a market cap of $6.3 billion on the cloud-based software company.

ServiceTitan currently has more than 8,000 customers with over $10,000 in annualised billings.

ServiceTitan stock debut matters a lot

ServiceTitan is a significant debut since not a lot of tech companies opted to go public in recent years as inflation and higher interest rates deterred appetite for riskier assets.

But the cloud company that now trades on Nasdaq as “STTN” raised about $625 million via an initial public offering and rallied more than 40% this morning to suggest investors are now ready to park their capital gain in tech.

In fact, continued push to the upside in the likes of Alphabet, Amazon, Tesla, Apple, and Meta Platforms pushed the Nasdaq Composite Index to an all-time high of over 20,000 this week.  

Other than founders Ara Mahdessian and Vahe Kuzoyan – names like Iconiq Growth, Bessemer Venture Partners, and TPG are some of the top shareholders of ServiceTitan at writing.

IPO market could pick up in 2025

ServiceTitan says its revenue increased by 24% on a year-over-year basis to $198.5 million in its October quarter. Still, it lost $47 million in the three months from about $40 million a year ago.

The warm welcome of STTN on the Nasdaq signals “a window is opening” in the IPO market, according to Greg Martin – the head of Rainmaker Securities.

Investors also expect pro-business policies under the Trump administration to help revive the long-dormant tech IPO market.

Just this morning, President-elect reiterated their commitment to cutting corporate taxes and accelerating the approval process for investments worth over $1.00 billion as he rung the bell at the New York Stock Exchange.

Both of his remarks can be interpreted as fairly positive for future initial public offerings.

ServiceTitan is not a cheap stock

ServiceTitan stock is rallying on market debut also because its leveraging AI via its Titan Intelligence platform. The offering provides actionable insights to plumbers, landscapers, roofers, and others in the trades industry.

Titan Intelligence also automates repetitive tasks, predicts outcomes, and improves customer and employee experiences.

Investors are cheering STTN as they see it as another play on the AI market that Statista forecasts will grow at a compound annualised rate of more than 28% through the end of 2029.

Nonetheless, some caution is warranted as ServiceTitan shares are not particularly inexpensive.

At $101, ServiceTitan stock is currently going for close to 13 times its trailing 12-month revenue.

In comparison, that multiple for the software industry at large typically sits between 6 times and 9 times.   

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