Jul 17 2020 0
On July 17th, we will look at the most important updates around the financial world right now.
Slow in subscription
Ted Sarandos has just been appointed chief executive at Netflix and he has faced a difficult task: to ease investor anxiety about their slowing growth. The company managed to let the longtime Content Director take over, along with the current CEO - Mr. Reed Hastings when one day, the company made a disappointing forecast on the number of subscriptions. This caused Netflix's stock to drop by 15% at the end of the session.
The world's largest paid streaming service is expected to register 2.5 million new subscribers in the third quarter, compared with an expected level of more than 5 million on Wall Street. It was a sudden decline from Netflix's massive growth during the first half of this year.
A quiet market
Asian stocks were ready for a quiet start on Friday after the plunge of technology stocks put pressure on Wall Street. The dollar appreciated. The futures market in Japan remains unchanged, while going up in Australia and Hong Kong. Treasury bonds rallied as the initial US unemployment report recorded its smallest weekly decline since March. In another movement, oil retreated from a four-month high, after the union. OPEC + has confirmed that it will start cutting production from next month.
Kweichow Moutai plunged the most in nearly two years after the influential People's Daily targeted the high price of alcohol the company assessed, saying it was often used in corruption cases. Shares of Moutai, the largest listed company in China, have fallen 7.9% in its worst slump since October 2018, wiping out a record $ 25 billion. The drop in value has resonated on the Chinese stock market nearly 10 trillion dollars, causing the SSE 50 index of the largest companies in the country to drop 4.6% - the worst decline since the beginning of February. Other winemakers have felt miserable too, such as Wuliangye Yibin, Jiangsu Brewery Joint Stock Company and Luzhou Laojiao, which all cut their daily limits by 10%. Officials have come up with what are considered to be the latest attempts to ease the national market sentiment, after retail investors took the majority of leverage for five years to speculate on stocks.
A special time
Six US giant banks, which have just cut $ 35 billion from their profits in preparation for a "tsunami" to remove gauze for bad debts, also made this confession: We are not really how bad it is. The current data is very conflicting. In a series of government programs that provide temporary support to consumers and businesses, the share of loans falling into bad debt unexpectedly dropped this year, even as millions of Americans are losing their jobs. Those who are arranging credit card payments and mortgages still take checks seriously.
This is an unprecedented situation, forcing bank leaders to make assumptions about how the pandemic and government reaction will take place. To adjust reserves, Citigroup had to assume the unemployment rate could improve slightly to around 10% by the end of the year. JPMorgan, on the other hand, makes a tougher assumption with that prediction of up to 20%. Bank leaders will reveal their huge reserves in the second-quarter results this week, but they will take turns calling on investors not to put too much faith in those numbers either. JPMorgan CEO Jamie Dimon noted: "This is just a very special time."