The Fed came very close to promising a rate cut Wednesday, and now markets are focused on a possible July rate cut.Market Insiderread more
Markets had expected the central bank to keep its benchmark interest rate steady while setting up a cut at the July meeting.The Fedread more
The yield on the benchmark 10-year Treasury note fell below 2% for the first time since November 2016 on Wednesday — breaching a key psychological level.Bondsread more
As the presidents of U.S. and China near a highly anticipated meeting on trade, the gap in both sides' expectations regarding a deal remains wide.World Politicsread more
Powell said policymakers are concerned about some of the recent economic developments and see a growing case for easier policy.The Fedread more
Amazon and Blue Origin founder Jeff Bezos gave more insight into his space company's lunar plans on Wednesday.Technologyread more
Sundar Pichai's note reads like a response to growing scrutiny from regulators, press and employees, and echoes a consistent theme of how Google helps people.Technologyread more
Delta warned travelers that a technical problem could delay flights on Wednesday.Airlinesread more
The Fed chief said that despite reports that Trump was looking to demote or fire him, he doesn't plan on leaving anytime soon.The Fedread more
If the Trump administration and Congress fail to reach a spending agreement, the White House will offer to keep the government funded at its current levels for a year, Mnuchin...Politicsread more
With bold and targeted steps, economists say, government can increase opportunity and incomes for many more people in ways that strengthen, not weaken, American capitalism.Politicsread more
But most top Wall Street analysts, though surprised by the timing of the news, told clients impact on the coffeehouse chain's growth will likely be negligible.
Here is what analysts are saying after the announcement:
Goldman Sachs said Starbucks' conference call on Thursday reassured investors that leadership would not pivot from its in-store innovation, and that there was strong internal preparation for the change.
"Mr. Johnson has a technology background, and, per the press release, Mr. Schultz plans to focus on the premium reserve brand. That said, the call clearly indicated that the product innovation/consumer technology pipelines pipelines (e.g. comp drivers) have never been 'so robust,' " Goldman said.
Goldman added leaderships' discussion of enhancement in the company's global operations was also a positive.
BMO said it is optimistic about the leadership change and believes that Starbucks will not alter its long-term outlook or performance. But the company said the timing is likely to raise a few eyebrows from investors.
"The negative initial perception (and stock reaction) to the leadership transition is understandable and the timing likely will raise questions," the firm said. "The transition of Howard Schultz...is likely to create a sense of trepidation among investors, particularly given the eventual deterioration in the company's performance after he last stepped down from the position."
The firm maintained its "outperform" rating on the company, saying Starbucks still remains well-positioned.
"While disappointing to see a visionary and founder step back from day-to-day operations, we believe the company is left in the capable hands of Mr. Johnson. And, we do not believe Mr. Schultz would step away from daily operations without feeling the same way," Oppenheimer said.
Guggenheim said its greatest concern is that "Starbucks is losing an irreplaceable merchant," but noted Johnson's strong leadership.
"[Johnson's] career prior to Starbucks includes 33 years in the technology industry which included 16 years at Microsoft and a five-years as CEO of Juniper Networks. Juniper shares appreciated 24 percent from Nov. 2008 to Jan. 2014 under Kevin Johnson as CEO, the S&P 500 increased 91 percent during that time frame, " Guggenheim said.
Stifel said it was not surprised by Schultz's decision to take a step back. It said any potential negative impact will most likely be felt a year or so from now.
"We view the timing as notable given the heightened level of strategic endeavors the company currently has ongoing. Additionally, while respectful of Mr. Johnson's prior managerial experience, Mr. Schultz is a visionary executive in retail and coffee with a unique understanding of consumer wants and is difficult to replace, particularly by a manager from a technology background, in our view, " Stifel said.