Tech stocks on the rise
US stock markets are surfing new highs as better-than-forecast results from technology giants are boosting gains across the sector. Although stronger economic growth in the US and globally has given rise to increased business confidence across the board, it’s estimated that a quarter of the S&P 500’s record-breaking return this year is down to a handful of over-performing tech stars.
The S&P 500’s gains put the index firmly on track to record its 104th month in a bull market. In fact, the price-to-earnings ratio of the US stock market hasn’t been this high since the dotcom bubble of the 1990s. And while there are no signs of an imminent crash, it’s a scenario that’s making some investors nervous.
Yahoo faces investigation over email privacy
It never rains but it pours! With public trust in freefall over the delayed announcement of a large-scale Yahoo account hack, the company’s decision to scan clients’ email accounts on behalf of US authorities has fuelled discussions in Europe over the thorny issue of privacy.
According to Reuters, Yahoo is facing criticism over its compliance with a classified US government request to comb through customers’ incoming emails for information specified by US intelligence officials. European politicians have since called on the European Commission (EC) to investigate the incident – which could derail the progress of the transatlantic data sharing deal agreed earlier this year.
‘Any form of mass surveillance infringing on the fundamental privacy rights of EU citizens would be viewed as a matter of considerable concern,’ commented Ireland’s Data Protection Commissioner in a statement.
Yahoo’s only response was that it ‘complies with the laws of the United States’, declining to confirm whether it scanned users’ emails or to say if Europeans’ emails were intercepted during the operation. The episode is likely to touch a nerve with Europeans who fear that the ‘Privacy Shield’ data sharing deal doesn’t offer enough protection against mass surveillance by US intelligence agencies.
Employed or self-employed?
In a decision that could have significant implications for thousands of employers and workers in the so-called ‘gig economy’ in the UK, Uber drivers have won the right to be paid the national living wage.
The case, brought by two workers leaves the ride-hailing company open to claims from some 40,000 drivers in the UK and could further pressure other companies to review the way staff are contracted and paid.
Uber had argued it was essentially a tech company, and that its drivers were self-employed contractors able to choose when and where to work. In turn, this gave the company a free pass on workers’ rights, including the obligation to pay a national living wage and other perks such as holiday and sick pay.
Tech giant Apple has been hit with Europe’s biggest-ever tax penalty after Brussels ruled that the company had received what amounted to illegal state aid from Ireland. The company will be required to pay billions of euro in back taxes as the European Commission seeks to redress the aggressive tax avoidance strategies employed by the world’s biggest corporations.
The judgment follows a three-year investigation into claims that Dublin violated EU law by granting Apple an advantage not available to other companies. It’s likely that the decision will be the subject of appeals by both Apple and Ireland – both of which deny any wrongdoing.
Law enforcement versus individual privacy
The mood between tech companies and the US government has been less than cordial in recent months following a series of stand-offs over law enforcement and customer privacy issues.
In the most recent high-profile case, a US appeal court has ruled that the government cannot force Microsoft to turn over to them data stored overseas and has rejected an earlier ruling that found the tech giant in contempt for failing to aid a narcotics prosecution.
The internet of things
Japanese telecoms business SoftBank has made a lightning-quick deal to buy British smartphone chip company ARM Holdings for $32 billion in a bid to become a major player in the ‘internet of things’ technology market.