Hey Gotraders,
It looks like regulators worldwide are keeping themselves very busy cracking down on tech companies. First, we heard about Chinese regulators cracking down on tech firms. Then we heard about US regulators cracking down on tech firms. Now it seems like the European regulators want to join the crackdown party. 🤦
WhatsApp, which is owned by Facebook (FB), has been fined 225 million euros ($267 million) by Ireland’s data watchdog for breaching EU data privacy rules. Ouch! This is the largest fine that Irish regulators have handed out for GDPR violations.
Ireland’s Data Protection Commission conducted a General Data Protection Regulation (GDPR) inquiry into WhatsApp and is alleging that they did not tell citizens in the European Union about how their personal information is collected and used, as well as how WhatsApp shares data with Facebook.
WhatsApp has been ordered to tweak its privacy policies and how it communicates with users so that it complies with Europe’s privacy law. WhatsApp plans to appeal the decision.
“WhatsApp is committed to providing a secure and private service. We have worked to ensure the information we provide is transparent and comprehensive and will continue to do so. We disagree with the decision today regarding the transparency we provided to people in 2018 and the penalties are entirely disproportionate” - WhatsApp.
Why is this important? European regulators have been keeping their eye on GDPR violations for a while now.
Amazon (AMZN) was fined 746 million euros in July by Luxembourg’s regulators for breaching GDPR rules around the use of consumer data in advertising. Google (GOOG) was fined 44 million GBP by France’s regulators in 2019 for similar violations.
📉 DiDi Chuxing summoned by Chinese regulators 😧
Uh oh… It looks like Chinese regulators have summoned and interviewed 11 ride-hailing companies, including DiDi Chuxing (DIDI). The regulators are claiming that these companies are recruiting unapproved drivers and vehicles.
“It’s required that these platforms should check their own problems, rectify illegal behavior, safeguard market orders of fair competition, and create a sound environment for the healthy development of the ride-hailing industry” - Ministry of Transport.
Shares of DiDi are down 34.94% year-to-date and closed at $9.20.
📉 Macquarie downgrades AMC 👎
Meme stock AMC (AMC) closed over 7% lower yesterday after analyst firm Macquarie downgraded their stock to “underperform” on their view that the recovery of movie theaters is taking longer than expected.
"The company was able to avoid filing for bankruptcy during COVID by raising capital ($2 billion of liquidity at 2Q21) and refinancing some of its debt, but leverage still remains an issue" - Analyst Chad Beynon. "Overall, we do not see the company generating positive FCF until 2023 and believe there are other ways to own the theatre space."
Macquarie maintained a $6 price target for AMC stock.
Shares of AMC closed at $43.69, down 7.30% for the day.
Top movers & shakers 🎢
What else is making headline news 📰
September is the toughest month for stocks, but this time could be different.
S&P 500 closes flat on first day of September, Nasdaq ekes out a record close.
Tesla (TSLA) must deliver Autopilot crash data to federal auto safety watchdog by October 22.
Apple (AAPL) announces first states that will let you keep a digital version of your driver’s license on your iPhone.
Popular companies releasing earnings this week 💰
Thursday: Broadcom (AVGO), DocuSign (DOCU), MongoDB (MDB), Hormel Foods (HRL), Hewlett Packard Enterprise (HPE)
A company’s market value may fluctuate considerably around the time that the earnings report is expected to be published. Stock prices may rise or fall according to analysts' speculative estimates, released prior to the actual earnings announcement.
The earnings season can be a time of great opportunity since better-than-expected figures could cause a company’s stock to greatly increase in value. Worse-than-expected results could have the opposite effect.
That’s all from us for now.
Signing out,
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