Global Tax Incoming
After job openings data from the Bureau of Labor of Statistics, the markets closed near-zero gains. — More on that in the “Overall Market” section.
Beyond the overall market, an online styling service company pleased investors with new strong guidance for 2021. Meanwhile, a second-hand clothing retailer’s stock underperformed after weak guidance for the year. — More on that in the “What’s Up?” and “What’s Down?” sections.
By the way, the G7 wants corporations to pay a global tax. — More on that in the “Water Cooler” section.
But, first, here is a recap of what happened in the market yesterday:
- U.S. markets: The stock market ended mixed on Tuesday. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Bitcoin’s price decreased back to $33K per coin.
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More Job Openings
The stock market ended mostly in the green zone on Tuesday.
After trading lower on the opening, the S&P 500 index and the Nasdaq index climbed back to above the flat line. On Tuesday, the Bureau of Labor Statistics reported that job openings increased to a record 9 million during last month. The markets believe the data could affect Fed officials’ monetary and fiscal policies as the economy rebounds from the pandemic.
So, what happened?
Shares of Stitch Fix (Ticker: SFIX) were up by more than 11% on Tuesday. The rally came after the styling company delivered a better-than-expected third-quarter report. After the previous earnings report disappointed investors with its revenue, the company bounced back to soar by more than 44% this quarter. The CEO Elizabeth Spaulding stated the company is confident revenue would continue to grow as the economy reopens and the apparel retail market resumes growth.
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Weak Guidance Effects
So what happened?
Shares of Poshmark (Ticker: POSH) were down by more than 4% on Tuesday. The second-hand clothing eCommerce company’s stock underperformed as investors are still not confident about its future potential. Earlier last month, the company announced a review of its annual guidance. The update resulted in a negative impact on Poshmark’s stock. The bearish feeling persisted as the stock plummeted more than 55% from its all-time high. As always, guidance is as much important as a good earnings report.
Global Tax Incoming
So what happened?
After a G7 meeting in London during the weekend, the US, UK, Canada, France, Germany, Italy, and Japan agreed on a global tax for corporate giants.
Companies would pay a 15% minimum rate independently of where they established headquarters. The G7 believes it would prevent companies from opening offices in countries with lower corporate tax rates to avoid tax deductibles. Although the agreement still needs the G20 approval, the decision marks a step forward to tax giant corporations globally. Following the agreement, the President Biden administration stated it would support the 15% global tax rate. According to the administration, it would increase US competitiveness against other lower tax rate countries.
Although companies found a way to avoid paying taxes for decades, it seems that the developed countries are determined to change that.
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