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US major indices close lower on coronavirus concerns

  
Analysis, US Market
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No records today

The major US indices are closing lower as concerns about the coronavirus worried investors.
  • The S&P index closed down -8.83 points or -0.27% at 33 to 0.79
  • NASDAQ index fell -18.135 points or -0.19% at 9370.80. The high reached 9397.578 (new all-time intraday high. The low reached 9350.20
  • Dow fell -152.06 points or -0.52% at 29196.04. The high reached 29341.21. The low extended to 29146.47
After the close Netflix reported earnings
  • revenues 5.47 billion versus 5.45 billion estimate
  • global net adds 8.76 million versus 7.6 million estimate
  • +550 K subscribers in US and Canada
  • earnings-per-share $1.30 versus $0.52 expected
  • sees first-quarter streaming paid net change of +7.00 million versus 7.82 million estimate
  • sees first-quarter EPS of $1.66 versus $1.16 estimate
Netflix stock is currently trading down $5.37 or -1.59% at $332.74 and after hours trading despite the beat. The subscriber numbers estimate for the 1st quarter is hurting the market even though this quarters global net adds surpassed the estimates by 1.1 million.
Meanwhile IBM reported:
  • earnings of $4.71 versus estimates of $4.69
  • revenues $21.8 billion versus $21.6 billion estimate
  • IBM is currently trading up $6.69 in after-hours trading

U.S. proposes barring big tech companies from offering financial services, digital currencies

  
  Analysis
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A proposal to prevent big technology companies from functioning as financial institutions or issuing digital currencies has been circulated for discussion by the Democratic majority that leads the House Financial Services Committee, according to a copy of the draft legislation seen by Reuters.

In a sign of widening scrutiny after Facebook Inc’s (FB.O) proposed Libra digital coin aroused widespread objection, the bill proposes a fine of $1 million per day for violation of such rules.

Such a sweeping proposal would likely spark opposition from Republican members of the house who are keen on innovation, and would likely struggle to gather enough votes to pass the lower chamber.

Even if it were to pass the full house, it would still have to pass the senate which would also likely be an uphill struggle.

Nevertheless, the draft proposal sends a strong message to large tech firms increasingly eyeing the financial services space.

The draft legislation, “Keep Big Tech Out Of Finance Act”, describes a large technology firm as a company mainly offering an online platform service with at least $25 billion in annual revenue.

“A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System,” it proposes.

Facebook, which would qualify to be such an entity, said last month it would launch its global cryptocurrency in 2020.

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