The daily business briefing: February 23, 2021
Facebook and Australia reach deal to end news blackout, bitcoin falls after Yellen expresses cryptocurrency concerns, and more
Facebook, Australia reach deal on media payment law, ending news blockade
Facebook said on Tuesday that it would restore access to Australian news pages after a week-long standoff over proposed legislation seeking to make tech companies pay for media content posted on their platforms. Facebook last week blocked Australian users from posting and sharing news content in response to the legislation. The social media company, which faced criticism from publishers and the government, lifted the ban after negotiating changes to the proposed law. The revisions include the addition of a proposed mandatory arbitration mechanism when tech giants can't reach an agreement on fair payment to publishers for the display of their news content. The deal was reached after talks between Treasurer Josh Frydenberg and Facebook CEO Mark Zuckerberg.
Bitcoin falls after Yellen expresses concerns
Bitcoin prices continued to slide early Tuesday, bringing their dive over the last 24 hours to 16 percent. The plunge came after Treasury Secretary Janet Yellen on Monday expressed concerns about the use of the cryptocurrency, calling it highly speculative, and an "inefficient" way to conduction transactions. She also said she fears it's often used for illegal activity. "People should beware it can be extremely volatile and I do worry about potential losses that investors could suffer," Yellen said at a New York Times Dealbook conference. The comments were the latest indication that Yellen's department would look into bitcoin and its use to protect investors. Yellen has hinted that more regulation could be coming for digital currencies.
Jay-Z sells half of Champagne company to LVMH
Jay-Z on Monday reached a deal to sell a 50 percent stake in his Champagne brand Armand de Brignac, also known as Ace of Spades, to luxury goods giant LVMH, which owns the Dom Pérignon and Moët & Chandon brands. The companies did not disclose the terms of the deal. Shawn Carter, who goes by Jay-Z, long championed the Cristal brand, but boycotted it in 2006 after the head of the company that makes it made disaparaging remarks about its popularity in the hip-hop community, saying: "What can we do? We can't forbid people from buying it." Jay-Z then switched to Armand de Brignac, featuring an Ace of Spades bottle in a 2006 music video and buying the company in 2014.
Stock futures fall after tech plunge
U.S. stock index futures fell early Tuesday following Monday's tech plunge. Futures for the S&P 500 and the tech-heavy Nasdaq dropped by 0.4 percent and 1.4 percent, respectively, several hours before the opening bell. Futures for the Dow Jones Industrial Average were flat. The Nasdaq dropped by 2.5 percent on Monday as Tesla shares lost 8.6 percent. Tech giants Apple, Amazon, and Microsoft all fell by at least 2 percent. Rising government bond yields have hurt demand for stocks and other riskier assets. Investors on Tuesday are awaiting Federal Reserve Chairman Jerome Powell's Tuesday testimony to Congress for fresh indications about the health of the economy.
Tesla shares continue slide after worst day in months
Tesla shares dropped by more than 6 percent in pre-market trading on Tuesday, continuing a slide that began Monday as investors shifted away from large tech stocks in favor of other stocks expected to rebound as the coronavirus pandemic eases. Tesla's stock dropped by 8.6 percent on Monday, its biggest one-day decline in months. Tesla's fortunes also could have been affected by bitcoin, which has fallen by 16 percent in the last 24 hours after a record-shattering rally. Tesla discosed earlier this month that it had purchased $1.5 billion worth of the cryptocurrency seeking "more flexibility to further diversify and maximize returns on our cash." Tesla also said it planned to start accepting payment in bitcoin.