A rocket company's strong profits lifted stocks, and shook phone carriers

Warm-up

How many things do you use that charge every month, like a phone plan, streaming, music or games?

• 0 to 2
• 3 to 5
• 6 or more
• No idea

Top story

U.S. stocks rose on Wednesday, and all four major indexes finished higher. The S&P 500 gained 0.6% and the Nasdaq gained 1.1%, pulling the S&P 500 closer to the record high it set earlier this month. According to the Associated Press, a much better profit report from SpaceX than analysts expected helped lift several other AI-related stocks, along with Tesla. Strong results from Capital One and other big companies also helped.

SpaceX matters to phone customers too. The company has said it may sell phone plans directly to consumers, which would compete with carriers like AT&T and Verizon. That worry helped push AT&T's stock down about 6% on Wednesday, even though its results beat forecasts. Today, the government reports weekly jobless claims at 8:30am ET. That's the number of people who filed for unemployment benefits last week. The last reading was about 206,000.

Why it matters to you: Your phone plan is a business's income. When a new competitor shows up, companies may have to cut prices or add perks to keep you, and investors react right away. Competition is one of the main reasons prices for things you buy can fall.

Your money

Small monthly bills add up

A recurring expense is a bill that comes back every month, like a phone plan, a streaming service or a music app. Because each charge is small, it's easy to stop noticing it. But the cost is the monthly price times 12, every year, for as long as you keep paying.

Here's the math. A $15 a month subscription costs $180 a year. Three of them cost $540 a year. Over four years of high school, that's $2,160, enough to cover many college textbooks or a good start on an emergency fund.

This is why companies compete so hard for your monthly payment, and why phone carriers worry about a new rival. You can use that. Once or twice a year, list everything you pay for monthly, cancel what you don't use, and ask whether a cheaper plan exists. Small cuts repeat every month.

Guess the number

One $15-a-month subscription, paid all four years of high school. What's the total?

Stock of the day

AT&T T −6.5%

AT&T's third-quarter results beat forecasts. It earned 65 cents a share, above the 60 cents analysts expected, on $32.3 billion in revenue. It added a record 769,000 internet customers and raised its profit forecast for the year. Its stock still fell about 6.5%. Coverage points to two worries: growth in new phone customers slowed from the previous quarter, and SpaceX may start competing in wireless service. A stock price reflects what investors think a company will earn in the future, called its outlook, not just what it earned last quarter.

Pop quiz

Class discussion

A rocket company might start selling phone plans. Would you switch carriers for a new company with a lower price? What would it have to offer to win you over?

Last bell

A rocket company eyes your phone bill

SpaceX is best known for launching rockets, but its Starlink satellites already sell internet service. Executives have said the company is considering selling phone plans directly to customers and has bought radio spectrum, the airwaves phones use. Phone company stocks have dropped on each new report. The carriers say satellites will complement their networks, and SpaceX hasn't launched a phone plan yet.

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