News of the day for July 5, 2024
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The US payrolls report is expected to show that employers added 200,000 jobs in June, fewer than last month; bitcoin (BTCUSD) and other cryptocurrencies plunge on fears of sell-off after failed exchange Mt. Gox begins $9 billion in payouts; European Union (EU) reportedly to warn social media platform X over content violations in latest move against U.S. tech companies; Disney (DIS), Netflix (NFLX), and other streaming services have asked a Canadian court to set aside a content fee; and Shell (SHELL) expects to take an impairment charge of up to $2 billion after halting work on a biofuel plant. U.S. stock futures are little changed after the Independence Day holiday. Here’s what investors need to know today.
1. The jobs report is expected to show a slowdown in hiring
After yesterday’s holiday, investors will start trading Friday with fresh labor market data when the Bureau of Labor Statistics releases its monthly jobs report at 8:30 a.m. ET. Economists forecast that employers added 200,000 jobs in June, down from 272,000 in May, while the unemployment rate is expected to remain at 4% and hourly wages are expected to rise 0.3%, up from 0.4% the month before. In minutes from the Federal Reserve’s June meeting released Wednesday, some officials said they are keeping a closer eye on the jobs data as inflation eases, as unexpected weakness in the labor market could prompt the Fed to cut rates more quickly.
2. Bitcoin and Ether Drop as Mt. Gox Payouts Begin
Cryptocurrency values ​​are plummeting after failed exchange Mt. Gox began disbursing payments to former customers that could total as much as $9 billion, spurring cryptocurrency sales among holders looking to cash in. Bitcoin (BTCUSD) is down about 3% to around $55,000, while ether is down 3.5%, part of a sell-off of a total of $170 billion in market cap over the past 24 hours. The Mt. Gox payout could bring between 65,000 and 140,000 new bitcoin to the market, while customers will also receive payments in Bitcoin Cash.
3. EU to reportedly warn X over failure to tackle dangerous content
The European Union (EU) is preparing to issue a formal warning to Elon Musk’s social media platform X for failing to combat dangerous content. This is the latest in a series of measures it has taken against major tech companies under recently passed laws, a Bloomberg report. A breach of the Digital Services Act (DSA) could result in X being fined as much as 6% of its turnover, the report said. The EU has also used its new Digital Markets Act (DMA) to crack down on other tech giants, including Apple (AAPL) with unfair restrictions on how developers can demand payments, and Facebook parent platforms (META) where users do not have the ability to opt-out of data collection.
4. Disney and Netflix are among the streamers that want to block the Canadian content fee
The Walt Disney Co.DIS), Netflix (NFLX), and other streaming companies have asked a Canadian court to halt plans to impose a 5% fee on sales in the country to help fund local content. The Motion Picture Association-Canada filing in the country’s Federal Court of Appeal seeks to halt the payments proposed by the Canadian Radio-television and Telecommunications Commission, which could cost streaming companies as much as CAD$200 million ($147 million) a year. The Wall Street Journal reported. Other streaming services in the lawsuit include Warner Bros. Discovery (WBD) and Paramount Global (PARA).
5. Shell to take $2 billion in charges after halting work on Dutch biofuel plant
British energy giant Shell (SHELL) said it would have to take an impairment loss of between $1.5 billion and $2 billion after pausing construction of a major Dutch biofuels plant. Europe’s largest energy company said on Friday it expects to book the tax after weak market conditions forced it to pause construction of a biofuels plant in Rotterdam and sell its chemical refinery in Singapore. The company also said it expected its Integrated Gas segment to generate lower revenue from first-quarter results “due to seasonality.”
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