EU regulators: Antitrust efforts hampered by lockdowns | Poll asks if virus is a health or an economic issue | Most Main St. loans are for $1 million or more
09 September 2020
SIGN UP ⋅   SHARE
Top Stories
JPMorgan Chase says it has evidence that some of its customers and employees have misused funds from the Paycheck Protection Program. "We are doing all we can to identify those instances and cooperate with law enforcement where appropriate," it states in a memo.
Full Story: The Hill (08 Sep.),  The Wall Street Journal (tiered subscription model) (08 Sep.),  Financial Times (subscription required) (08 Sep.) 
LinkedIn Twitter Facebook Email
Lockdowns aimed at slowing the spread of the coronavirus created obstacles for European merger reviews and major antitrust investigations, officials said. The conditions made it difficult for firms to comply with information requests and for authorities to conduct activities such as dawn raids and surprise inspections.
Full Story: Bloomberg (tiered subscription model) (08 Sep.) 
LinkedIn Twitter Facebook Email
A slender majority of Americans see the coronavirus pandemic more as a health crisis than an economic crisis but the gap between the two views is narrowing, according to a poll. The proportion of respondents who see the pandemic mostly as a health issue is now 52%, down from 56% in July, while whose who view it as primarily an economic problem has risen from 43% to 47%.
Full Story: The Hill (08 Sep.) 
LinkedIn Twitter Facebook Email
Loans for $1 million or more account for nearly all the transactions in the US Main Street Lending Program, which was created to help small and medium-sized businesses. Through the end of August, only 11 of the 118 loans under the program were for less than $1 million.
Full Story: Bloomberg (tiered subscription model) (08 Sep.) 
LinkedIn Twitter Facebook Email
Market Activity
A selloff swept through Asian-Pacific markets Wednesday, with tech shares' decline similar to that seen in the US. Japan's Nikkei 225 declined 1%; China's Shanghai Composite dropped 1.9%; Hong Kong's Hang Seng Index gave up 0.6%; Australia's S&P/ASX 200 plunged 2.2%; South Korea's Kospi lost 1.1% and India's Sensex was down 0.5%.
Full Story: CNBC (09 Sep.),  The Economic Times (India) (09 Sep.) 
LinkedIn Twitter Facebook Email
Tesla has been omitted from the S&P 500, against expectations, with some analysts attributing its exclusion to the volatility of its share price and the quality of its earnings. In the most recent quarter, $428 million of Tesla's revenues came from the sale of emissions credits to other automakers.
Full Story: The Wall Street Journal (tiered subscription model) (08 Sep.) 
LinkedIn Twitter Facebook Email
Only 4% of companies surveyed by the American Chamber of Commerce in Shanghai say they plan to heed President Donald Trump's call to move production from China to the US. More than 75% said they have no intention of relocating production that is currently done in China.
Full Story: Bloomberg (tiered subscription model) (08 Sep.) 
LinkedIn Twitter Facebook Email
China's factories posted the smallest decline in producer prices in five months in August, suggesting the country's recovery from the coronavirus pandemic is gaining traction. Core consumer prices rose for the first time since the coronavirus outbreak deepened in China in January.
Full Story: Reuters (09 Sep.) 
LinkedIn Twitter Facebook Email
BlackRock strategists have downgraded their outlook for the US investment-grade corporate credit market but remain "moderately" bullish on corporate debt generally and in particular on the high-yield market. The US government engaged the firm this spring to engineer its intervention in corporate credit markets, and this downbeat assessment follows similarly pessimistic soundings from other debt investors.
Full Story: Bloomberg (tiered subscription model) (09 Sep.),  Reuters (08 Sep.) 
LinkedIn Twitter Facebook Email
Some banks have switched to calculating stressed value-at-risk by modeling it on a period of stress that includes the coronavirus outbreak rather than the previous global financial crisis. "[F]or those banks that have to retain the Covid period for their SVAR-based charge, market risk capital requirements may remain stuck at a higher level for many, many years," writes Louie Woodall.
Full Story: Risk (subscription required) (08 Sep.) 
LinkedIn Twitter Facebook Email
Shares of Slack Technologies fell 18% Tuesday after the company reported making $11 million in coronavirus-related concessions in the first half and a slowdown in Q2 billing growth. Quarterly billings were up 25%, less than the 38% growth achieved in the first quarter.
Full Story: Reuters (08 Sep.) 
LinkedIn Twitter Facebook Email
Analysis by Goldman Sachs points out that the current high levels of market volatility alongside a surging S&P 500 is a rare occurrence that repeats the pattern seen before the dot-com bubble burst.
Full Story: Financial News (UK) (tiered subscription model) (08 Sep.) 
LinkedIn Twitter Facebook Email
Economics
The pace of consumer borrowing picked up for the second consecutive month in July, mostly for big-ticket items like college tuition and cars. Borrowing on credit cards and other sources of revolving credit declined 0.4%, but the use of nonrevolving credit surged 4.8%.
Full Story: MarketWatch (tiered subscription model) (08 Sep.) 
LinkedIn Twitter Facebook Email
Geopolitical/Regulatory
UK Northern Ireland Minister Brandon Lewis has acknowledged to a session of the UK parliament that the government's plan to change the terms of the Brexit transition deal made with the EU will breach international law. Theresa May, a former British prime minister, asked how the government could "reassure future international partners that the UK can be trusted to abide by the legal obligations of the agreements it signs?"
Full Story: Bloomberg (tiered subscription model) (08 Sep.) 
LinkedIn Twitter Facebook Email
The newest coronavirus aid proposal from Senate Republican leaders drops assistance for airlines and airports that was included in an earlier version. When the initial $25 billion of airline payroll support runs out this month more than 35,000 airline workers are on track to lose their jobs.
Full Story: Reuters (08 Sep.) 
LinkedIn Twitter Facebook Email
Policy options open to the European Central Bank to rein in further increases in the value of the euro include cutting interest rates, signaling more quantitative easing or publicly advising against allowing it to rise, a tactic used by former ECB chief Mario Draghi. The euro has gained 10% in value since March, undermining attempts by ECB policymakers to stoke inflation.
Full Story: Bloomberg (tiered subscription model) (09 Sep.) 
LinkedIn Twitter Facebook Email
LEARN MORE ABOUT CFA:
About CFA Institute  |    Educational Resources  |    Social Media
SmartBrief publishes more than 200 free industry newsletters - Browse our portfolio
Sign Up  |    Update Profile  |    Advertise with SmartBrief
Unsubscribe  |    Privacy policy
CONTACT US: FEEDBACK  |    ADVERTISE
SmartBrief, Inc.®, 555 11th ST NW, Suite 600, Washington, DC 20004