Equity markets in the United States wrapped the week on a negative note, with the Dow (DJI) and S&P 500 (GSPC) recording their first weekly decline in three weeks, and the Nasdaq (IXIC) shedding about 0.7 percent for the week. The period was marred by uncertainty around a coronavirus relief deal, amid disagreements over several aspects of the bill among lawmakers.

Aftermarket hours on Friday and well into the weekend, Pfizer-BioNTech’s vaccine candidate received approval for emergency use in the United States, raising hopes of some respite amid the unstoppable spread of COVID-19 in the country. In just under 48 hours since the approval, the first batch of the vaccine was dispatched from the company’s factory in Michigan and arrived in record time on Monday.

Top Stories This Week

United Airlines raises expectations of its cash burn per day

United Airlines Holdings (UAL) has said its average cash burn during the fourth quarter could soar to $26 million per day along with $10 million of average debt principal and severance payments per day during the quarter, as COVID-19 continues to spread rapidly in the United States. The company also expects its fourth-quarter revenue to drop close to 70 percent from a year ago, putting its shares in focus that are down about 47 percent so far this year. But, they have recovered from their lowest point in May when the shares’ value was down almost 80 percent.

Snap Summary
United became the third airline after Delta Air Lines (DAL) and American Airlines (AAL) to raise its forecast for cash burn per day. The move also exemplifies the pain experienced by the aviation sector, one of the hardest hit due to the coronavirus crisis. The industry is estimated to be losing billions of dollars every month as people avoid travel due to the pandemic and its related advisories and restrictions.

Walt Disney announces a flood of new content, fresh subscriber targets

Walt Disney Co. (DIS) unveiled a range of new announcements for its Disney+ platform, with more than 100 movies and shows linked to franchises such as Marvel, Star Wars, FX, and National Geographic, at its Investor Day presentation. Along with the flood of content announcements, the company announced new business targets and programming costs of around $16 billion in FY2024. By the end of fiscal 2024, Disney anticipates attracting as many as 350 million global subscribers across all streaming services, more than double of about 137 million users it has currently. It expects Disney + to be profitable by fiscal year 2024.  Shares of the company surged 13% following the announcement.

Snap Summary
 With the flurry of announcements, Disney is looking to take on the incumbent player in streaming services, Netflix Inc (NFLX), and expand its base in the home entertainment segment. With more people staying in their homes and hunting for new shows amid the pandemic, the move marks an aggressive push in the direction towards gaining more market share in the streaming space. Its Disney + platform was launched just a year ago and with its current user base, it already has reached the upper end of the goal it had previously set for 2024.

Lululemon Athletica raises holiday quarter revenue, profit forecast

Lululemon Athletica (LULU) bumped up its holiday-quarter revenue and profit forecasts. The athleisure apparel maker now expects fourth-quarter revenue to rise by mid-to-high teens percentage, compared with its previous forecast of a high single-to-low double-digit increase.

Snap Summary 
The company has been a beneficiary from the coronavirus-led stay-at-home orders and other restrictions, with people choosing to workout more at home than visiting the gym. That boosted the demand for its athletic clothing significantly. The unabated spread of the virus in the United States and the ensuing potential curbs continue to be likely tailwinds for the company, whose shares have gained about 60% this year.

Big Tech firms Facebook, Google face U.S. government pushback

Nearly every U.S. state, along with the U.S. Federal Trade Commission, have filed lawsuits against Facebook (FB), accusing it of using a ‘buy or bury’ strategy to buy rivals and dilute competition in the space. The complaint focused on its acquisitions of Instagram and WhatsApp in 2012 and 2014, respectively. Meanwhile, California has asked to join an antitrust lawsuit filed by the U.S. Department of Justice against Google (GOOG) that accuses the company of using its market muscle to keep rivals at bay.

Snap Summary
The latest developments highlight a growing pressure on Big Tech companies by the U.S. government to make such firms accountable for their business practices. They also bring to the fore the bipartisan support behind such legal moves as both the Trump administration and Democrats have come on board to challenge the internet giants.

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