The daily business briefing: August 4, 2020

1. Lawmakers, White House continue talks on coronavirus relief

Congressional Democrats and White House negotiators said Monday they were making progress toward an agreement on a new round of coronavirus relief. "There are a lot of issues that are still outstanding," Senate Minority Leader Chuck Schumer (D-N.Y.) said. "But I think there is a desire to get something done as soon as we can." Treasury Secretary Steven Mnuchin, who along with White House Chief of Staff Mark Meadows met with leading Democrats on Capitol Hill, said there had been "a little bit of progress" on Monday. House Democrats passed a $3 trillion plan, but Senate Republicans are proposing a $1 trillion package. Meadows rejected the idea of a bigger plan, and White House adviser Kellyanne Conway said Trump "is always considering executive action in the absence of congressional leadership."

Reuters

2. Trump repeats TikTok-ban threat, sets deadline for Microsoft deal

President Trump on Monday doubled down on his threat to ban TikTok, but said he would accept an acquisition of the Chinese social media app by Microsoft provided it happened quickly. Analysts believe his threats are a negotiation tactic to force TikTok's Chinese parent company, ByteDance, to fully divest its U.S. operations. "I don't mind" if a large American company buys TikTok, Trump said. "It'll close down on Sept. 15 unless Microsoft or somebody else is able to buy it and work out a deal." Microsoft has confirmed it is having ongoing talks with ByteDance about a deal. The Trump administration has scrutinized TikTok lately because of concerns that ByteDance is providing American users' data to the Chinese government.

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Bloomberg

3. BP reports big loss and unveils green strategy

BP on Tuesday reported a $16.8 billion quarterly loss as it wrote down the value of projects to reflect a steep decline in oil prices. Analysts had expected a loss of $11.6 billion. In the same quarter last year, the company posted a $1.8 billion profit. The oil giant slashed its dividend in half and outlined plans to make its operations less harmful to the environment. Under the green strategy, BP will avoid exploring for crude in new countries, and increase its low-carbon investment tenfold by 2030. "With energy now occupying an almost pariah status in the mind-set of many investors, BP's attempts to shift should at least attract some interest and analysis," said Citi analyst Alastair Syme. BP shares, which have dropped 40 percent this year, rose by nearly 7 percent in London trade.

MarketWatch

4. Stock futures edge down after Monday's gains

U.S. stock futures traded lower early Tuesday after Monday's tech-fueled rally. Futures for the Dow Jones Industrial Average were down by 0.2 percent several hours before the opening bell. Those of the S&P 500 and the Nasdaq both fell by about 0.3 percent. The Dow rose by 0.9 percent on Monday. The S&P 500 gained 0.7 percent to close at its highest level since Feb. 21, leaving it just 3 percent below its record high set on Feb. 19. The tech-heavy Nasdaq jumped by 1.5 percent. Microsoft and Apple helped power the rally, gaining 5.6 percent and 2.5 percent, respectively. "Tech stocks have captured considerable attention for their gaudy, relative total return performance, but what is less appreciated is how 'consistent' they have been," wrote Jim Paulsen, chief investment strategist at The Leuthold Group, in a note to clients.

CNBC

5. Sony posts smaller profit drop than expected

Sony on Tuesday reported a 1.1 percent drop in quarterly operating profit, a much smaller decline that analysts had expected. The Japanese electronics and entertainment giant benefited from the strength of its gaming business as customers under coronavirus lockdown downloaded more games. The company said it expected profit to drop by 26.7 percent through next March. That would reduce profit to its lowest point in four years, but still mark improvement over the decline of 30 percent or more estimated in May. Sony has remained stronger than Panasonic and other Japanese electronics rivals largely because of its recurring revenue, such as gaming subscriptions. Sony recently has pushed to boost these revenue streams by investing in Chinese video site Bilibili and Fortnite creator Epic Games.

CNBC