Wall St rises after Netflix introduces record US price hike

Wall Street was boosted by a 6.5 per cent surge in Netflix shares.

Wall Street was boosted by a 6.5 per cent surge in Netflix shares. Photo: Freestocks/Unsplash

Despite a strong lead from Wall Street, the Australian share market is expected to start the day with very little momentum.

Australian Stock Exchange (ASX futures were practically flat at 8.05am (AEDT).

The Australian dollar was steady at 72 US cents and 55.9 British pence.

Overnight, the dollar had climbed 1 per cent to 56.4 pence — but has since given up those gains after UK Parliament voted overwhelmingly against Theresa May’s Brexit deal.

US markets finished on a stronger footing, with the Nasdaq index jumping 1.7 per cent to 7,024.

The benchmark S&P 500 closed 1.1 per cent higher at 2,610.

The Dow Jones index lifted 156 points, or 0.7 per cent, to 24,066.

Markets at 8:05am (AEDT):

  • ASX SPI futures flat at 5,754, ASX 200 (Tuesday’s close) +0.7pc at 5,815
  • AUD: 71.98 US cents, 55.88 British pence, 63.06 Euro cents, 78.23 Japanese yen, $NZ1.06
  • US: Dow Jones +0.7pc at 24,066, S&P 500 +1.1pc at 2,610, Nasdaq +1.7pc at 7,024
  • Europe: FTSE 100 +0.6pc at 6,895, DAX +0.3pc at 10,892, CAC +0.5pc at 4,786, Euro Stoxx 50 +0.4pc at 3,068
  • Commodities: Brent crude +2.8pc at $US60.65/barrel, spot gold -0.2pc at $US1,289.20/ounce, iron ore flat at $US73.78/tonne

European markets closed moderately higher ahead of the British parliament’s vote on the Brexit deal — with London’s FTSE gaining 0.6 per cent and Germany’s DAX index adding 0.3 per cent.

Netflix price hike

Wall Street was driven higher, in particular, by Netflix shares, which jumped 6.5 per cent to a three-month high of $US354.64.

This was after the TV streaming company said it would increase monthly prices by 13-18 per cent for its US subscribers — its largest-ever price hike.

“It highlights that Netflix has pricing power and even after the increase it remains a very cheap entertainment alternative,” said Jeff Wlodarczak, an analyst at Pivotal Research Group.

Netflix has been spending billions to bolster its original content, which boasts award-winning shows such as ‘The Crown’ and ‘Black Mirror’, to fend off intensifying competition from players such as Amazon’s Prime Video service.

The company reported it had 137 million customers at the end of September.

The price hikes are expected to fetch Netflix hundreds of millions of dollars, ahead of its rivals AT&T and Disney launching competing streaming services.

The broader market was also boosted by tech-related stocks Facebook (+2.5pc), Amazon (+3.6pc), Apple (+2.1pc) and Google’s parent company Alphabet (+3.3pc).

Meanwhile, JP Morgan posted a lower-than-expected quarterly profit, but its shares still rose 0.7 per cent.

Another major bank, Wells Fargo, reported that fourth-quarter revenue fell in all of its major businesses, sending its stock sliding 1.6 per cent.


Topics: Netflix
Stay informed, daily
A FREE subscription to The New Daily arrives every morning and evening.
The New Daily is a trusted source of national news and information and is provided free for all Australians. Read our editorial charter
Copyright © 2024 The New Daily.
All rights reserved.