US Briefing - Friday 31.07
Headlines
  • WAPO: WH Willing To Cut A Stimulus Deal Without ‘Liability Shield'
  • Congressional Leaders, White House Fail To Reach Covid-19 Stimulus Deal
  • ECB's Lagarde: We Have To Maintain Safety Net At Least Until June 2021
  • EZ Q2 GDP In-Line Q/Q At -12.1%; July Core CPI (Y/Y): +1.2% (est 0.8%)
  • Facebook, Apple, Amazon Soar Pre-Mkt As Earnings Smash Estimates
  • German Covid-19 Cases Rise By 989; Largest Increase Since Jun 19
  • German June Retail Sales Beat Estimates +5.9% Y/Y (est +3%)
  • French GDP Fell 13.8% In Q2, Italian GDP -12.4%; Both Better Than Feared
  • French June Consumer Spending Shoots Back Above Pre-Lockdown Level
  • Cable Storms Above 1.31, Shrugs Off New UK Lockdown Measures
  • UK July Nationwide House Prices Show Surprise Rebound: +1.7% M/M
  • The Sun: UK PM To Halt Planned Further Relaxation Of Lockdown
  • China Jul Mfg PMI Rebounds Further To 51.1; Beats Estimate Of 50.8
  • BoJ Leaves Bond Buying Operations Unchanged Going Into August
  • US Pledges Up To $2.1B For Sanofi, Glaxosmithkline Covid-19 Vaccine
  • Caterpillar's Stock Surges As Q2 Profit, Revenue Fall Less Than Expected
  • Google Suffers First Revenue Decline As Ads Hit By Pandemic
  • Glencore Ups Trading Expectations, Sticks To Copper, Cobalt Guidance
  • BT Group Falls Despite Profit Beat As Analyst Note Weak Guidance
Commentary
Big Tech Earnings Surge During Pandemic

The largest US technology companies are thriving in a pandemic that has increased dependence on their products and services, while hammering much of the rest of the economy. Quarterly results from Apple Inc., Amazon.com Inc., Facebook Inc. and Alphabet Inc. on Thursday show the industry is capitalizing on the crisis as locked-down consumers use tech gadgets and the internet for entertainment, social connection, shopping, learning and work.

 

Together, the four companies reported revenue of $206 billion and net income of $29 billion in the three months ending in late June. “Right now, it’s big tech’s world and everyone else is paying rent,” said Wedbush Securities analyst Dan Ives. “They are consumer staples now and this crisis has bought their growth forward by about two years.”

 

The four companies’ results hit a day after their leaders faced congressional hearings into whether they have broken antitrust rules and need to be reined in. Apple executives were quick to recognize how their strong results contrasted with an economic collapse that has caused millions of job losses, hundreds of thousands of deaths and many bankruptcies.

(Bloomberg – Continue Reading)

Eurozone Enters Recession On Record Growth Plunge

It’s ugly, but was expected. The Eurozone economy entered recession with a record contraction in the second quarter after a number of countries in the single currency area announced historic declines in GDP during the period, one that included the height of coronavirus lockdowns in Europe.

 

The Eurozone’s quarterly growth rate plummeted to -12.1pct, according to preliminary data from the EU statistics office Eurostat. The historic decline was just slightly worse than the -12.0pct market estimate and fell well below the -3.6pct reading in the first quarter. The single-currency area reported flat growth in the final quarter of 2019.

 

EU GDP plunged 11.9pct on the quarter, which was also a record decline. The euro continued lower against the greenback following the report and was more than half a cent below its peak after pushing above 1.19 early in Europe’s morning session. The second-quarter growth numbers could be subject more adjustments than in the past due to the coronavirus pandemic, Eurostat said. “These preliminary GDP flash estimates are based on data sources that are incomplete and subject to further revisions under the Covid-19 containment measures.”

(LiveSquawk – Continue Reading)

Gold Sets Fresh Record Heading For Best Month In Eight Years

Gold surged to a fresh record Friday fueled by a weaker dollar and low interest rates. Silver headed for its best month since 1979.

 

Spot bullion is up 11% in July, heading for its best month in eight years, as a gauge of the dollar slumped, prompting concerns its status as the world’s reserve currency of choice is at risk, and U.S. real yields fell to a record low. While the ferocity of rallies in both gold and silver cooled in the middle of the week, most market watchers predict there may be more gains ahead.

 

Both metals are headed for their biggest annual gain in a decade, with record inflows into gold and silver exchange-traded funds, as concern about the fallout from the coronavirus pandemic boosts demand for havens. The Federal Reserve this week repeated a vow to use all its tools to support the U.S. economy, with governments and central banks worldwide already unleashing vast amounts of stimulus to shore up growth. 

Silver is also getting added support from investors betting on a rebound in industrial demand amid concerns over supplies.

(Bloomberg – Continue Reading)

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