The World
The pandemic-induced downturn initially had hints of being the sharpest but shortest U.S. recession on record. Now there are increasing signs of economic scarring that resemble past slumps. Meanwhile, the economic hit is emerging as particularly bad for millennials, born between 1981 and 1996, who as a group hadn’t recovered from the experience of entering the workforce during the previous financial crisis. Already indebted and a step behind on the career ladder, this second pummeling could keep them from accruing the wealth of older generations. In the UK, one in three British businesses are planning job cuts in 3Q20 as the government’s coronavirus furlough scheme winds down. And yet, optimism ticked up in a survey of nearly 500 U.S. CEOs, as an increasing number of companies planning for renewed growth in the months ahead—if the nation comes together to overcome the challenges of Covid. (Bloomberg, Wall Street Journal, Financial Times, Chief Executive)
China announced sanctions on 11 Americans, including lawmakers and NGO executives, in retaliation for U.S. sanctions on a group of Hong Kong and mainland Chinese officials. The list includes Senator Marco Rubio, Senator Ted Cruz, Senator Tom Cotton, Senator Josh Hawley, Senator Pat Toomey, and Rep. Chris Smith, all of whom are Republicans. As well, Beijing deployed fighter jets that briefly crossed the midline of the Taiwan Strait, as U.S. HHS Secretary Alex Azar was in Taiwan for the highest-level US visit to the island in decades. Meanwhile, Hong Kong media tycoon Jimmy Lai became the highest-profile person arrested under a new national security law, detained over suspected collusion with foreign forces as around 200 police searched his Apple Daily newspaper offices. (South China Morning Post, South China Morning Post, Reuters)
ByteDance is preparing to escalate its legal and PR battle against President Trump’s executive order to ban the app, as talks with Microsoft and Twitter are unlikely to end in a deal, said one of the people briefed on the talks. The person said the probability of Microsoft buying TikTok is “not higher than 20%” since the initial price offered was akin to “robbing the owner when his house is on fire.” Meanwhile, TikTok is looking to re-enter the territory through the financial services sector, as ByteDance applied for five licences with Hong Kong’s Securities and Futures Commission to advise and deal in securities, futures contracts, corporate finance and manage assets. (South China Morning Post, Apple Daily)
Lebanon’s Cabinet resigned over last week’s devastating blast at the Beirut port, as Prime Minister Hassan Diab will head to the presidential palace to “hand over the resignation in the name of all the ministers.” In Belarus, protesters were left bloodied as police used stun grenades and rubber bullets, as official exit polls predicted a landslide — 80% of vote — for long-term dictator Alexander Lukashenko. In the UK, more migrants are crossing the Channel to Britain as political tension rises. (Associated Press, The Times, Reuters)
Buoyed by bailout funds, all major for-profit hospital chains reported increased profits in 2Q20 — with some more than tripling their net income compared to last year. Meanwhile, a JAMA study finds racial bias in the government’s formula for distributing Covid-19 aid to hospitals. (HealthcareDive, StatNews)
Walt Disney World is reducing operating hours at all four of its theme parks, following the phased reopening last month. Meanwhile, only 18% of parents said they were interested in visiting a theme park this summer, but 78% said they weren’t interested in taking that step. 61% said they’re “not interested at all.” (Hollywood Reporter, Morning Consult)
Economy
Atlanta Braves owner Liberty Media disclosed the team’s 2Q20 results, revealing dramatic losses: Revenue plunged 95% compared to the same period a year ago, falling from $208 million to $11 million. The team posted an operating loss before amortization and depreciation of $28 million, compared to a profit of $61 million in the same period last year. (Atlanta Journal-Constitution)
Simon Property Group has been in talks with Amazon to take over space left by ailing department stores, turning some of the anchor department stores into Amazon distribution hubs. (Wall Street Journal)
There will be a $2tn surge in trade in services over the next five years with more countries adopting technology and switching to remote working after the Covid-19 pandemic, according to the study from Oxford Economics and Western Union. (The Telegraph)
A JPMorgan report reveals a ‘dramatic’ Covid shift to electronic bond trading, as the proportion of electronic trades continued to rise even as markets calmed. Barclays is being probed by the UK’s privacy watchdog over allegations that bank spied on its staff. (Financial Times, Reuters)
Biotech IPOs have surpassed their record, raising roughly $9.4 billion, already beating the $6.5 billion raised in all of 2018, the biggest year on record. This year’s biotech issues have jumped an average of 34% on their first day of trading, the biggest average first-day pop for the sector since the tech boom in 2000. (Wall Street Journal)
Technology
Consumer spending on video gaming in the U.S. reached a record $11.6 billion in 2Q20, an increase of 30% when compared to the same time period last year, and a 7% increase over the 1Q20 record $10.9 billion. (NPD)
Latin America boasts five times as many female-founded fintechs as the global average. In 2019, fintech received 31 percent of the region’s venture capital, and more than 35 percent of Latin American fintech startups have female founders. (Crunchbase)
Uber CEO: Gig workers want both flexibility and benefits — we support laws that could make that possible. (New York Times)
Smart Links
Blockbuster deals led an M&A activity resurgence since start of July. (Financial Times)
The benefits of unproductivity. (Harvard Business Review)
North Texas home market shrugs off pandemic with record sales and prices. (Dallas News)
The latest trend among wealthy American travelers? Buying another country’s citizenship. (Washington Post)
23-year-old wins PGA Championship in second career major. (ESPN)