Raphael Stevens

Beijing city announced that starting Monday, most people need to be vaccinated before entering in-person training centers, sports centers, entertainment venues and other social gathering spots.
The vaccine requirement comes after a resurgence in new cases in Beijing, Shanghai and other parts of China in the last week.
Different cities have tightened Covid controls in the last few days.

Chinese cities like Beijing, pictured here on July 6, 2022, require negative virus tests from within the last 72 hours in order to enter most public spaces.
Kevin Frayer | Getty Images News | Getty Images

BEIJING — China’s capital city is set to require Covid vaccinations for entering gyms and some other venues, the first mandate at such scale in the country.
The vaccine requirement comes after a resurgence in new cases in Beijing, Shanghai and other parts of China in the last week.

Beijing city announced Wednesday that starting Monday, most people need to be vaccinated before entering in-person training centers, sports centers, entertainment venues and other social gathering spots.
The city said the requirement did not apply to people for whom vaccinations were not “suitable,” but said vaccinated people would get priority for entering the above venues. Many spaces operate at a lowered capacity due to Covid restrictions.
Generally only Chinese-made vaccines by Sinopharm or Sinovac are available to the public in China.
Beijing has a relatively high vaccination rate. The city said Wednesday it vaccinated 23.4 million people, including 3.6 million above the age of 60. The capital city said it had nearly 22 million long-term residents as of 2020.

Government events in Beijing have already required attendees to be vaccinated against Covid, while some industries such as taxi services have encouraged or mandated vaccinations as well.

About two months ago, Beijing began requiring people to take virus tests before visiting public spaces.
Similar rules have taken effect in Shanghai and other parts of China, while at least one or two cities have attempted to stop regular virus testing after local case counts dropped. Analysts have noted the high cost of Covid tests and other measures for local governments.
Mainland China reported 94 new Covid cases with symptoms for Wednesday, including 32 in Shanghai and 4 in Beijing.

Read more about China from CNBC Pro

Other cities have also tightened Covid controls in the last few days.
The central China city of Xi’an announced Tuesday a week-long closure of entertainment and leisure venues, and a ban on dining in person at restaurants.
Shanghai city announced two rounds of mass virus testing from Tuesday to Thursday, and temporary closure of karaoke venues as of Wednesday.

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Signage is seen at the 2019 Deadline Contenders Hulu Reception at Paramount Theater on the Paramount Studios lot on April 07, 2019 in Hollywood, California.
Rachel Murray | Getty Images

Disney has a Hulu problem.
In 2019, the entertainment giant struck an unusual agreement with Comcast. Two months earlier, Disney had acquired Fox’s 33% stake in Hulu as part of a $71 billion acquisition, giving it a majority stake in the streaming service.

That put Comcast Chief Executive Brian Roberts in an odd position. Comcast owned the other 33% of Hulu. Roberts thought the value of Hulu would increase as the world shifted to streaming video, but he didn’t want or need to own a passive stake.
Roberts and then-Disney CEO Bob Iger struck a deal to temporarily save Disney billions after splurging on Fox while taking operational control of Hulu. Comcast agreed to hold its stake in Hulu until January 2024. Then, Comcast can force Disney to buy its 33% of Hulu at a minimum total valuation of $27.5 billion. The price tag could be higher depending on fair market value of Hulu in 2024 as determined by an independent third party.

The Hulu conundrum

Disney is approaching a 2024 deadline when it must pay Comcast billions for a one-third stake in Hulu.

Disney hasn’t specifically detailed its strategic plans for Hulu in the future.

One possible solution is for Disney to sell Hulu to Comcast, but such a deal would mean Comcast would forgo about $10 billion, if not more, as a payment from Disney.

At the time, Disney+ was being built. It would launch eight months later, in November 2019. Hulu seemed like a highly strategic asset as millions of Americans canceled cable TV in favor of free and subscription streaming services.
Fast forward three years, and the raison d’etre and future of Hulu is unclear to investors, analysts, media executives and even Disney employees. Disney+ has become Disney’s flagship subscription streaming offering, with 138 million global subscribers as of April 2. Hulu is U.S.-only, with just over 41 million subscribers.
Disney is on the hook to pay billions of dollars for an asset that now seems like an awkward fit. There’s little evidence investors care about Hulu’s quarterly results. In fact, the better Hulu performs, the more Disney will have to pay Comcast to buy the rest of it in 2024.
“Disney has never declared what its strategy is for Hulu,” said Jon Miller, who served on Hulu’s board from 2009 to 2012. “Is it a distributor of other products? Is it Disney’s adult brand? It’s hard enough to run a single major SVOD [subscription video on demand] service. Disney already has Disney+. Wall Street wants to know, ‘How many chips can you afford to have on the board at any given time successfully?'”
This dynamic has led to executives at both Disney and Comcast to at least evaluate alternatives. Roberts and Disney CEO Bob Chapek are at the annual Sun Valley media conference this week. The two executives haven’t spoken for about six months, according to a person familiar with the matter. But the conference, famed for big media transaction discussions, could be a place to renew talks.
Lightshed media analyst Rich Greenfield has floated the idea that Comcast could buy Hulu from Disney rather than the other way around.
“We see no reason why Disney+ cannot be a broad entertainment service,” Greenfield wrote in a note to clients. “Parental controls are now available to prevent children from accessing more mature content. This raises the multibillion dollar question of why Disney even wants to own Hulu?”

The strange saga of Hulu

Perhaps Hulu’s most important strategic purpose is to support Disney+ subscriptions. It does this by being part of the “Disney bundle.” Disney+ is Disney’s family and kids service, Hulu is its broad, Netflix-like offering, and ESPN+ is its sports service. Disney markets and sells all three together for $13.99 per month, helping boost Disney+ subscribers and mitigate churn.
Otherwise, Hulu’s fit at Disney is clumsy. Hulu can’t be marketed with Disney+ globally because it’s not an international product. Like Disney+, Hulu also has kids programming — thousands of hours of licensed movies and TV series, and original programming, like the reboot of the old Warner Bros. animated series “Animaniacs.” Hulu functions as a house for “not-Disney Disney” content. That may be easy to understand for the Disney executives who decide what appears on Disney+ versus Hulu, but it’s not necessarily straightforward to customers.
Adding to the confusion, Disney appears to be pushing the boundaries on Disney+’s audience, adding the popular reality competition show “Dancing with the Stars” to its flagship service rather than Hulu. But not all family-friendly reality competition is on Disney+. Chef Gordon Ramsay’s “MasterChef Junior,” for example, is only on Hulu.

This season’s remaining four couples will dance and compete in their final two rounds of dances in the live season finale where one will win the coveted Mirrorball Trophy.
Eric Mccandless | Disney General Entertainment Content | Getty Images

Hulu is also about to lose a large swath of its popular programming when Comcast removes its current-season TV shows, such as “Saturday Night Live” and “The Voice,” later this year. Comcast is putting the programming on its own flagship streaming service, Peacock.
Beyond the programming challenges, Hulu with Live TV is a completely separate product that combines Hulu’s subscription video on demand service with a bundle of digital cable networks for $69.99 per month. This offering has more than 3 million subscribers and includes live sports and programming on linear networks.
Hulu’s messy positioning within Disney is largely due to the fact that it was never meant to be a Disney-only service. It launched in 2008, with backing from NBCUniversal, still owned by General Electric at the time, and News Corp., which owned Fox. A year later, Disney took a stake.
At its inception, Hulu was a free streaming service supported by advertising, mainly used as a vehicle to watch back episodes of broadcast TV shows. By 2016, Hulu had fully shifted to paid subscription, with pricing tiers for ads and no ads. The shift coincided with big money licensing deals for both movies and TV series, such as “Seinfeld,” and a move to original programming. Also that year, Comcast, which had then acquired NBCUniversal from GE, Disney and Fox all sold a little more than 3% of Hulu to Time Warner, bringing in more programming to Hulu.
In 2017, Hulu’s “The Handmaid’s Tale” became the first streaming show to win the Primetime Emmy for Outstanding Drama Series.

Hulu’s role in the streaming wars

When Disney acquired most of Fox in 2019, Disney became the majority owner of Hulu. Time Warner agreed to sell its stake in Hulu back to Disney and Comcast, giving 66% control to Disney and 33% to Comcast.
The same year, global media companies began shifting their business models to focus on streaming video. Instead of relying on Hulu, Disney launched Disney+. Comcast unveiled Peacock in July 2020 after a three-month test run.
Buoyed by giving users access to nearly every significant Disney movie ever made at just $6.99 per month, Disney+ was an immediate success, surpassing 10 million subscribers in its first 24 hours. By the end of 2020, Disney had bumped its 2024 forecast for Disney+ to 230 million to 260 million global subscribers. Each quarter for the past 2.5 years, Disney shares largely move up or down based on how many subscriber additions the company reports.

CEO of Comcast Brian Roberts arrives for the Allen & Company Sun Valley Conference on July 06, 2021 in Sun Valley, Idaho.
Kevin Dietsch | Getty Images

Chapek just signed a new contract with Disney to remain as CEO until 2025. He’ll be judged on whether Disney hits its 2024 Disney+ target. It’s safe to say he won’t be judged on Hulu’s subscriber totals.
As Hulu became a metaphorical appetizer for Disney+, it’s also experienced leadership changes. Randy Freer served as Hulu’s CEO from 2017 to 2020. In February 2020, Kelly Campbell replaced Freer as Hulu’s head. Less than two years later, Campbell departed Hulu for Peacock.
Still, Hulu has doubled its total subscribers since 2018. The streaming service continues to churn out critically acclaimed series, including “Pen15,” “Dopesick” and “The Dropout.”
“The irony of Hulu is if they’d failed at programming, this would actually be an easier problem to solve,” said Miller, the former Hulu board member.

Hulu’s future

Hulu has valuable brand recognition from its 15 years of existence, especially compared with competitors that have largely been around for three years or less. It has a built-in advertising business that will take in $2.7 billion this year, according to MoffettNathanson — more than any other streaming service.
Disney executives have viewed Hulu as a way to keep Disney+’s price-value proposition clear. Some at Disney have seen Netflix’s recent struggles as evidence that the world’s biggest streaming platform offers too much content at too high of a price — a similar issue to what has led millions to cancel cable TV, according to people familiar with the matter. If Hulu is merged into Disney+, when Disney inevitably raises the price, some executives have expressed concern users could see Disney+ as a bloated product rather than relatively inexpensive niche offering.
One of Chapek’s missions at Disney is to get the company’s different divisions swimming in the same direction. Part of that goal appears to be to further integrating Hulu with Disney+, especially as Disney prepares to launch an advertising-supported Disney+ later this year. Disney is deploying its Disney Streaming Services (previously called Bamtech) across all of its streaming properties to better unify the technology. There are obvious money-saving synergies from selling advertising on Disney+ and Hulu with the same sales staff using a unified technology stack.
But if Hulu simply becomes a tile within Disney+, similar to HBO within HBO Max, it’s fair to question the service’s long-term value. As Greenfield noted, Disney is already able to put parental controls around adult themed content on Disney+.
That’s why Comcast makes more sense as the eventual owner of Hulu, Miller said.
“Disney has built one of the top global streaming platforms in Disney+,” said Miller. “Hulu could be Comcast’s answer.”
If Comcast acquired Hulu, it could use Peacock as its free advertising-supported platform, similar to how Paramount Global has paired Pluto with Paramount+, Miller said. Comcast could then move its premium content spend onto Hulu while also building it out as an aggregation distribution platform.
“Hulu’s third-party distribution business is a much better fit for Comcast,” said Miller. While Comcast has sold cable TV for decades, Disney isn’t a distributor by nature.
The problem is Comcast would likely have to pay billions back to Disney, and it’s still not clear whether Hulu’s original programming plus NBCUniversal’s content would be strong enough to compete with Netflix, Amazon, Apple and Disney around the world. If it can’t, Comcast would be doubling down on a potentially money-losing business.
Plus, Comcast already has what may be a $10 billion check, if not more, guaranteed from Disney, to spend on whatever it wants.
Hulu is stuck in the middle.
No, not “Stuck in the Middle,” the kids TV series starring Jenna Ortega. That’s on Disney+.
Disclosure: CNBC is part of Comcast’s NBCUniversal.
WATCH: Media moguls meet in Sun Valley with consolidation in focus

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Retail businesses in Singapore are grappling with higher costs as rents rise and energy prices soar, the Singapore Retailers Association said. 
The surge in energy tariffs is mainly fueled by higher energy costs driven by “rising global gas and oil prices exacerbated by the conflict in Ukraine,” utilities company SP Group said.
Song Seng Wun, economist at CIMB Private Banking, said rentals, labor costs and utility charges have all gone up, and it’s “hitting everyone” including retail businesses.

Retail businesses in Singapore are grappling with higher costs as rents rise and energy prices soar, the Singapore Retailers Association said. 
Cost pressure is a big concern for many Singapore retailers which have not completely passed on price increases to consumers, and are currently feeling the “margin squeeze,” Ernie Koh, the association’s president told CNBC’s Street Signs Asia Tuesday. 

Singapore utilities company SP Group announced that electricity tariffs will be bumped up by about 8% compared to the previous quarter from July to September. 
“The increase is mainly due to higher energy cost driven by rising global gas and oil prices exacerbated by the conflict in Ukraine,” SP Group said.
Energy prices are likely to remain elevated over the second half of 2022 and residents should brace for inflation to continue staying high before it stabilizes, the Finance Ministry said in June.

Retail businesses in Singapore are grappling with higher costs as rents rise and energy prices soar, the Singapore Retailers Association said.
Bloomberg | Bloomberg | Getty Images

Last month, Deputy Prime Minister and Minister for Finance Lawrence Wong announced a $1.5 billion support package to provide immediate relief to vulnerable groups and local businesses facing higher operating costs. 
The government has been proactive in responding to the volatile environment and is willing to help retailers manage their electricity bills and rent increases, Koh said.

Not everyone agrees that high electricity prices are impacting retailers.
Electricity only contributes a small proportion to the rising costs for retailers, said Song Seng Wun, economist at CIMB Private Banking.
He said rentals, labor costs and utility charges have all gone up as well, and it is “hitting everyone” including retail businesses. “For retail businesses, as far as energy costs, it’s just electricity to turn on and off the lights. So we see that it’s just a small proportion of the total costs,” Song added.

Rise in retail sales

Despite the current inflationary landscape, retail sales in May Singapore increased by 17.8% year-on-year, compared to April’s 12.1% rise, according to data from the Department of Statistics, or SingStat.
Excluding motor vehicles, retail sales rose by 22.6% in May, compared to the 17.4% increase the previous month, SingStat said.

All of the tourism and travel that’s coming back is clearly helping to boost consumption in Singapore.

senior economist, Barclays

“It’s not very surprising that we see demand pick up in such a substantial way,” said Brian Tan, a senior economist at Barclays.
He said that the pent-up demand in spending is coming from tourists, instead of Singapore residents.
“All of the tourism and travel that’s coming back is clearly helping to boost consumption in Singapore,” Tan said.
He dismissed suggestions that it was due to “revenge spending” from Singapore residents, and said “it doesn’t make sense” there is pent-up demand now, since they were able to purchase those goods in the last six months anyway.
Department stores which were gravely affected by Covid-19 restrictions in 2021 saw sales jump by 73.1% as consumer confidence bounced back. But supermarkets and hypermarkets had a 10.3% decline in sales as there was a higher demand for groceries in May 2021 when residents were staying home, SingStat reported.

Sales for motor vehicles declined by 10.2% since last year and by 5.7% on a month-on-month basis.
Tan said this is mainly due to the rising cost of car ownership. In addition to paying for the car, automobile owners must also pay for the the license to own one, known as a Certificate of Entitlement. COEs for one category of cars hit a record high of $110,524 Singapore dollars ($78,820) this week — surpassing the previous high in 1994, according to local reports.
Although furniture and household equipment sales increased by 4.7% compared to last year, it declined by 1.7% on a month-on-month basis.
“If you think about the last two years, a lot of the demand in the sector was due to people being forced to work from home and study from home,” said Tan. “Now that they’re all going back to the offices and people are able to travel, it’s probably a bit less in demand.”

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American Airlines pilots will get triple pay to fly thousands of trips dropped in scheduling glitch.
American and the pilots’ union also agreed to double pay for peak holiday flights.

An American Airlines Boeing 787-9 Dreamliner approaches for a landing at the Miami International Airport on December 10, 2021 in Miami, Florida.
Joe Raedle | Getty Images

American Airlines pilots and its pilots’ union agreed to triple pay for aviators who were able to drop thousands of July flights because of a scheduling program glitch over the weekend, they said Wednesday.Pilots will also get double pay for peak holiday periods.
The scheduling platform error let pilots drop some 12,000 flights from their schedules, according to the union, the Allied Pilots Association, CNBC reported last week.

The issue sprung up while American and other airlines have been scrambling to avoid flight disruptions during a surge in summer travel demand.
“We’re pleased to have reached an agreement with the APA and appreciate their partnership in coming to a resolution quickly to take care of our pilots, our team and our customers,” American said in a statement.
A similar issue occurred in 2017, when a technology problem let American’s pilots take vacation during the busy December holiday period. The carrier offered pilots 150% pay for pilots who picked up assignments.
American and the pilots union are in contract negotiations. APA’s president, Capt. Ed Sicher, told the union’s roughly 15,000 pilots: “I am optimistic it will provide a springboard for us to wrap up our Section 6 negotiations and secure the new collective bargaining agreement that we have been waiting far too long to achieve.”
American recently offered pilots raises of nearly 17% through 2024.

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CNBC’s Jim Cramer on Wednesday warned investors that if they own any buy now, pay later stocks, they should brace themselves for more damage to their portfolios.
“These stocks never should’ve been worth so much in the first place,” he said.

CNBC’s Jim Cramer on Wednesday warned investors that if they own any buy now, pay later stocks, they should brace themselves for more damage to their portfolios.
“These stocks never should’ve been worth so much in the first place. Their business models were much more attractive when interest rates were incredibly low, but it remains to be seen if they work in a more normal environment,” the “Mad Money” host said.

“Even if it doesn’t seem like it at the time, earnings matter. Valuations matter. The economic landscape, it matters. … That’s what we’ve learned this year, and it’s been agonizing if you had fintech exposure. I don’t think the pain is necessarily over,” he added.
Buy now, pay later services, or BNPL, rocketed in popularity during the pandemic as consumers shifted to online shopping. The space for BNPL companies has since grown, with companies such as Affirm, Block, Upstart, PayPal and Apple in tight competition.
Cramer said that BNPL’s boost from the pandemic is long gone, especially as Wall Street worries about a looming recession and the Federal Reserve fights to beat down inflation.
“The moment the Federal Reserve declared war on inflation in November, Wall Street turned against growth, including the whole financial technology edifice. … The buy-now pay-later plays, like Affirm, are everything this new market hates: unprofitable, expensive,” he said.
“For more diversified payment plays like Block and PayPal, they also had cryptocurrency trading exposure, which has turned into” a hindrance for them, he added.

Cramer also pointed out that BNPL stocks are well below where they once were, and it’s unclear whether they’ll make a recovery.
“It’s been an abominable decline,” he said.
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It’s that time again! “Mad Money” host Jim Cramer rings the lightning round bell, which means he’s giving his answers to callers’ stock questions at rapid speed.

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Boeing Co: “I’m not going to recommend stocks that lose money with really bad balance sheets. And that’s what they do.”

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United States Steel Corp: “There is too much negativity on steel right now. The one you would buy is Nucor, and it has to come down a little bit more.”

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Synopsys Inc: “I’ve always like Synopsis. … I do believe the semiconductor stocks have come down too much, and there are other semiconductor companies that I think are cheaper to buy than that one.”

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Tenneco Inc: “I’d be very careful. … I do not have a great call on what will happen with TEN.”

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CNBC’s Jim Cramer on Wednesday said that the market could find a bottom later this year now that stocks have come down and Wall Street’s optimism has waned. 
“The charts, as interpreted by Tom DeMark, suggest that with just a little more weakness, this market’s finally got a legitimate chance to bottom,” he said.

CNBC’s Jim Cramer on Wednesday said that the market could find a bottom later this year now that stocks have come down and Wall Street’s optimism has waned. 
“The charts, as interpreted by Tom DeMark, suggest that with just a little more weakness, this market’s finally got a legitimate chance to bottom for the first time since everything started rolling over last November. … I hope he’s right, and more importantly, I think he is right,” he said.

The “Mad Money” host said that DeMark and his team have a 13-step buy-or-sell countdown model that helps them find highs and lows in the market. The trend eventually exhausts itself when there is a certain number of sessions going in the same direction, he said.
He added that the key to finding a bottom is to identify when sellers have run out of steam, and everyone who planned to sell already has.
To start his explanation of DeMark’s analysis, Cramer first examined the daily chart of the Dow Jones Industrial Average.

Arrows pointing outwards

According to DeMark, the Dow hit 13 on the buy countdown on June 17, but there’s a secondary countdown that’s still at 12, Cramer said.
“That means the Dow may have bottomed last month or maybe there will be one last downdraft that takes us to a lower low,” he said.

According to Cramer, DeMark also believes there are parallels between the Dow’s performance this year and in 1973, represented by the blue line on the chart.
“He was using the same 13-step countdown even back then, and it worked just as well as it does now. They believe the relationship is noteworthy and, if it holds, we see some more choppy trading for the Dow over the next couple of months, followed by a strong rally in September and October … but then a large decline into the end of the year,” he said.
“If DeMark is right, then right now we could be looking at an incredible trade,” he added.
For more analysis, watch the video of Cramer’s full explanation below.

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Traders on the floor of the NYSE, June 16, 2022.
Source: NYSE

U.S. stock futures were little changed on Wednesday night as investors digested the most recent meeting minutes from the Federal Reserve.
Dow Jones Industrial Average futures rose by 26 points, or 0.1%. S&P 500 and Nasdaq 100 futures climbed 0.1% and 0.1%, respectively.

Shares of GameStop popped 8% in extended trading after the video game retailer said a 4-for-1 stock split was approved by its board. Shareholders at the market close on July 18 will get a dividend of three additional shares for each of GameStop’s Class A common stock, the retailer said. The dividend will be distributed after trading closes on July 21.
Earlier in the day, the S&P 500 posted its third straight day of gains following the release of the June meeting minutes from the central bank. The broader market index added nearly 0.4%. Meanwhile, the Dow gained more than 69 points, or 0.2%. The Nasdaq Composite rose close to 0.4%.
Stocks climbed after the release of the Federal Reserve’s June meeting minutes. Central bank officials reiterated a tough stance against inflation, saying another 50- or 75-basis point move would “likely be appropriate” at the July 26-27 meeting.
Still, many investors found it challenging to trust those gains as recession concerns continue to loom on Wall Street, and as market participants looked ahead to what many expect will be a volatile earnings season this month.
“Everybody is both emotionally and sort of market level exhausted,” Alli McCartney, managing director at UBS Private Wealth Management, said Wednesday on CNBC’s “Closing Bell.” “So, I think we still have a summer of watching for what the Fed does, watching for what happens in international policy, watching for the directionality of CPI.”

On the economic front, traders will parse through the latest reports on weekly jobless claims and international trade that are due out Thursday before the bell.
Meanwhile, Levi Strauss is set to report earnings Thursday after the bell.

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