Hello friends and Fortune readers.
Wall Street stock futures are sharply higher this morning as a bounce in oil prices and ECB president Mario Draghi’s threat of extra stimulus forces some hasty short-covering ahead of the weekend. A Saudi official told the World Economic Forum in Davos late Thursday that crude prices below $30 a barrel were ‘illogical’, but he didn’t say that the world’s largest oil producer was going to do anything concrete about forcing its logic on the rest of the market. Crude futures are back over $31 and are now up for the week, while other commodity prices such as copper have also rebounded.
Today’s must-read story is a William D. Cohan piece that is the cover story of Fortune magazine’s February 1, 2016 issue. The story looks at what Cohan calls “Silicon Valley’s $585 billion problem,” which is that private investors have pumped billions of dollars into the tech industry’s “unicorn” startups only to see the tech IPOs run into trouble to start 2016.
Here’s what else you need to know to start the day.
1. Winter storm Jonas
A major winter storm is expected to hit the U.S. East Coast this weekend, with snowstorms that started in the Mid-Atlantic Thursday night resulting in accumulation throughout Friday before the storm moves north toward New York City on Saturday. The storm is likely to cause major delays for travelers while affecting businesses in several states. Multiple airlines, including United (UAL) and American Airlines (AAL), had already begun suspending and canceling various flights across the Northeast on Thursday evening.
2. GE Q4 earnings
General Electric (GE) will report fourth-quarter and full-year results this morning and the company is expected to post a drop-off in both earnings and revenue for the most recent quarter. GE’s oil and gas equipment business has suffered of late due to plummeting crude oil prices, with the company forecasting a revenue decline of as much as 15% in 2016 for that unit. Meanwhile, investors will want to hear updates on GE’s transition into being more of a digital-focused industrial company after a year of shedding its finance arm, GE Capital, and trimming non-core assets as it did with the sale of its appliances business to China’s Haier.
3. December home sales
The National Association of Realtor is expected to report that existing home sales jumped by 8.9% in December, hitting an annual rate of 5.2 million units. That would represent a nice rebound from the 10.5% drop the market saw in November—a fall that realtors attributed to new federal rules for mortgage forms that caused closing delays.
4. United Airlines pilots vote
Pilots at United Airlines, the country’s second-largest carrier, will finish voting on a contract extension today that would raise their wages by 22% within two years. The company has seen rough labor relations since it worked to integrate employees from United and Continental following a 2010 merger and the pay raise would help maintain labor peace for another two years.
5. OMG, these noodles are amazing! Oh, wait…
China’s Food and Drug Administration busted thirty five restaurants this week for adding poppies and ground poppy powder to dishes in the apparent hope the opiates induced repeat customers. China’s maligned and overworked food and drug administrators may be to blame in what’s being called the country’s latest food scandal.
—Reuters contributed to this post.
