Intel, Snap, Bitcoin, Biden and Capital Gains Taxes: 5 Things You Must Know

Stock futures rise following the S&P 500's sharpest drop in five weeks; a report says President Biden proposes raising taxes on wealthy investors; bitcoin drops below $50,000 on tax worries.
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Here are five things you must know for Friday, April 23:

1. -- Stock Futures Rise After Biden Tax Proposal Sinks Markets

Stock futures rose modestly Friday following the S&P 500's sharpest drop in five weeks after a report said President Joe Biden would propose raising taxes on wealthy investors.

Contracts linked to the Dow Jones Industrial Average rose 11 points, S&P 500 futures gained 6 points and Nasdaq futures were up 16 points.

A report from Bloomberg said the Biden administration was considering almost doubling the tax on capital gains to 39.6% for those earning more than $1 million a year. When including a surtax to help pay for Obamacare, the top federal tax rate for wealthy investors could be as high as 43.4%.

Jim Cramer: If the Capital Gains Taxman Cometh, Be Ready for Anything

Stocks fell sharply Thursday following the Bloomberg report. The Dow dropped 321 points, or 0.94%, to 33,815, the S&P 500 fell 0.92% and the Nasdaq slumped 0.94%.

Stocks had traded mixed for most of Thursday's session following better-than-expected corporate profits and jobless claims that fell to a pandemic low, but also a renewed surge in coronavirus infections.

Biden's tax proposal is just the latest consideration for investors as they navigate through a market weighing signs of recovery in the U.S. but also worries that virus flare-ups could derail the economy's comeback.

2.-- Friday's Calendar: American Express and Honeywell Earnings

Honeywell International  (HON) - Get Report, reported first-quarter adjusted earnings of $1.92 a share, higher than analysts' estimates of $1.80.

American Express  (AXP) - Get Report earned $2.74 a share in the first quarter, well ahead of analysts' calls for earnings of $1.61 a share.

Honeywell is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells HON? Learn more now.

The U.S. economic calendar Friday includes the PMI Composite Flash for April at 9:45 a.m. ET and New Home Sales for March at 10 a.m.

3. -- Intel Falls as Data-Center Sales Slump 20%

Intel  (INTC) - Get Report was falling nearly 3% in premarket trading after the biggest chipmaker said first-quarter revenue at its Data Center Group fell more than 20% from a year earlier and missed analysts' estimates. 

Revenue at one of Intel’s most profitable businesses dropped to $5.56 billion, below Wall Street forecasts of $5.89 billion. 

The company also reported a decline in gross margins to 55.2% during the quarter.

The drop in data center revenue overshadowed an earnings beat and a boost in Intel's annual forecast. Sales at the company's personal computer business had their best quarter in years.

Intel raised its sales forecast for the full year to $72.5 billion, up slightly from previous guidance of $70 billion.

The stock fell 2.83% to $60.80 in premarket trading.

4. -- Snap's Earnings Beat Expectations and Daily Users Surge

Snap  (SNAP) - Get Report was rising in premarket trading Friday after the social media company beat Wall Street's first-quarter expectations and reported a surge in active daily users.

Revenue jumped 66% to $770 million, higher than forecasts of $744 million. Snap posted a loss in the first quarter of 19 cents a share, but that was below forecasts that called for a loss of 26 cents a share.

Snap said daily active users increased 22% to 280 million. Analysts had been forecasting 275.4 million, according to Bloomberg.

"We began 2021 by achieving our highest year-over-year revenue and daily active user growth rates in over three years during the quarter, and delivering positive free cash flow for the first time in Snap’s history as a public company," CEO Evan Spiegel said in a statement.

Snap said it expects second-quarter revenue of $820 million to $840 million vs. analysts’ estimates of $823.9 million. Adjusted Ebitda was forecast at between a loss of $20 million to break-even.

The stock rose 5.43% in premarket trading Friday to $60.15.

5. -- Bitcoin Falls Below $50,000 on Tax Worries

Bitcoin traded below $50,000, falling for the seventh time in eight days, after the Bloomberg report said President Joe Biden was crafting a proposal to almost double the capital gains tax for the wealthy.

According to CoinDesk, bitcoin fell over the past 24 hours to $49,820, down 7.94%.

U.S. investors in bitcoin, the world's largest cryptocurrency, already face a capital gains tax if they sell the digital asset after holding it for more than a year, according to Bloomberg. Anyone who bought bitcoin a year ago has seen a nearly 550% gain, Bloomberg noted. For investors who bought in April 2019, the gain is roughly 800%.

The Internal Revenue Service has been stepping up enforcement of tax collection on crypto sales, Bloomberg noted.