Good morning, CFOs. The S&P 500 crossed 5000 for the first time in intraday trading, the latest milestone for a U.S. stock market powered by a resilient economy and subsiding inflation.

The broad U.S. stock index popped over 5000 in the final minute of trading Thursday, according to Dow Jones Market Data, before settling slightly below the mark. The S&P 500’s daily advance of 0.1% was enough for another record close, its ninth of 2024.

The benchmark index is up 4.8% in 2024, helped by gains in shares of companies ranging from technology to healthcare to financials.
The Dow Jones Industrial Average gained 0.1%, or about 49 points, to its 11th record close of 2024. The tech-heavy Nasdaq Composite rallied 0.2%, leaving it 1.6% off its record close from November 2021.

A drumbeat of earnings reports has driven moves in individual stocks, including Walt Disney on Thursday, and continued to shape the outlook for the broad market.

🗓️ Earnings

• Enbridge
• PepsiCo

📈 Economic indicators

The Bureau of Labor Statistics releases its annual revisions to the consumer price index.

Akash Palkhiwala, finance and operations chief at chip maker Qualcomm, talked with CFO Journal about the company’s plans for its soon-to-be maturing debt and its experimentation with generative artificial intelligence on its finance team. Palkhiwala, who has been CFO since 2019, received the additional post of chief operating officer last month, giving him oversight for the global go-to-market organization and operations. Edited excerpts follow.

WSJ: How is the prospect of falling interest rates affecting the timing of when you refinance?

Palkhiwala: We have a maturity coming up in May. It’s approximately $915 million. Our historical approach has been to refinance when our bonds mature. The environment obviously is in transition. There’s a lot of changes happening and it’s difficult to predict exactly where the interest rates will go. We’re analyzing given the current situation and have not made a decision yet, but we’ll evaluate it.

WSJ: Where are you applying generative AI in the finance function?

Palkhiwala: In the finance realm, there are a lot of areas we’re evaluating. Using gen AI for some kind of forecasting for cash flow, for cost structure, with employees. Using it for Q&A, where rather than going through a very detailed model, you can ask the model a question. You could get an answer to some of those questions very quickly. Looking at intersystem trends, say employee expense reports and using gen AI to flag things that are inconsistent with historical trends and then having our employees evaluate it. There’s a lot of experimentation going on right now. One of the challenges is you could use it at a lot of places. How do you find the places where there’s a biggest bang for the buck and deploy it in those areas, versus doing something that’s broader and diluting your effort across a lot of different initiatives?

WSJ: How far away are you from implementing this in finance?

Palkhiwala: By the end of the year, we’ll have some initial deployments and will be benefiting from it. Forecasting, looking at employee expense reports for account reconciliations and accounting. Given where our company focus is, the first thing we do is implement it on the engineering side and use it there as that’s most of our employee base and then the support functions including finance will come later in the process.

—Mark Maurer

Coach owner Tapestry is diverting certain inventory shipments in response to the Red Sea conflict, Chief Financial Officer Scott Roe said.

Houthi rebels have stormed onto cargo ships in the Red Sea in response to Israel’s war with Hamas militants in Gaza, causing freight rates to surge. Tapestry, which also owns Kate Spade and Stuart Weitzman, is monitoring the conflict and has seen a “small impact” on freight costs and a few shipping lanes, the CFO said in an interview. “We have options,” according to Roe, who also serves as the company's chief operating officer. “We’re rerouting around the Red Sea where we can.”

Tapestry hasn’t disclosed specifics about the inventory impacts, Roe said, adding that it’s not material.

—Jennifer Williams

March 5-6, 2024 | New York, New York
Request an invitation | Participants and program

The era of cheap money is behind us and CFOs must now grapple with how to operate in a high interest-rate environment, how fast to invest in artificial intelligence, and how to manage geopolitical tensions and thorny labor relations. With U.S. elections on the horizon, the CFO Network will discuss–through both newsmaking interviews and peer-to-peer discussions–how finance executives are reading the markets, driving the push for greater corporate efficiency and managing the pushback on ESG and DEI. Join WSJ journalists and some of the biggest names in corporate finance to discuss, debate and make headlines.

Confirmed speakers include:
Martin Small, Senior Managing Director, Global Head of Corporate Strategy and CFO, BlackRock
Bori Cox, CFO, Consumer and Community Banking, JPMorgan Chase
Paul Ryan, Vice Chairman, Teneo; 54th Speaker of the House

Epic Games’ $1.5 billion boost from entertainment giant Disney will bring the Magic Kingdom to the world of “Fortnite” in a bid to widen the continuing success of the nearly seven-year-old blockbuster.

• The Federal Deposit Insurance Corp.’s human-resources operation has an HR problem.
• American CEOs traveling to China face big challenges. Perhaps the most terrifying? The local tradition that business leaders dance and sing on stage to huge crowds.

📰 Other headlines

• How Rockefellers, Billionaire Donors Pressured Biden on LNG Exports
• The Spectacular Crash of a $30 Billion Property Empire
• Sam Altman Seeks Trillions of Dollars to Reshape Business of Chips, AI

Walgreens Boots Alliance, the Deerfield, Ill.-based drugstore chain, named Manmohan Mahajan as its permanent finance chief as it boosts its healthcare business through other leadership changes. Since his interim appointment in July, Mahajan has played a key role in aligning the company's cost structure with business performance, Walgreens said.

NFI Group, the Winnipeg-based bus and coach manufacturer, named Brian Dewsnup to succeed Pipasu Soni, the company's chief financial officer since 2020. Dewsnup will take on the role of executive vice president and finance chief starting March 1. Soni, who is returning to the U.S. to pursue other opportunities, will support the transition through the second quarter of the year.

—Sabela Ojea and Robb M. Stewart contributed to this newsletter.

Sunday’s Super Bowl ads will share one thing in common: An even deeper-than-usual desire by marketers to avoid offending anybody.

Finance chiefs are taking advantage of favorable conditions in the bond market while they last.

Adam Neumann is trying to buy back WeWork as creditors consider a sale.

Corporate America’s diversity initiatives aren’t dead, but the prescription has changed.

Every weekend we select a handful of articles we think are worth a bit of your time, either because they peel back the layers on a compelling business story or somehow make us look at business in a different light.

• Can Xi Jinping win back the markets? asks The Economist.
• New York City’s housing crunch is the worst it has been in over 50 years, according to the New York Times.
• McKinsey & Co. has warned about 3,000 of the firm’s consultants that their performance was unsatisfactory and will need to improve, Bloomberg reports.

The Feb. 8 edition of The Morning Ledger incorrectly attributed a survey finding that 68% of CFOs expect their tax liability to grow in the next 12 months to Gartner. Accounting firm Grant Thornton released the survey.

The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics ranging from corporate tax accounting, regulation, capital markets, management and strategy.

Follow us on X @WSJCFO. The WSJ CFO Journal Team is reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew.

You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.