The World
Americans have become more pessimistic about the prospects for a quick pandemic recovery, especially in the U.S. South and West: 49% of likely voters believe the outbreak will get worse in their community over the next month, a sharp increase from 35% a month ago. Only 24% said they believed it would improve. (Financial Times Poll)
Atlanta Fed chief Raphael Bostic warned the U.S. recovery may be ‘leveling off,’ as he is troubled by data on business openings. Meanwhile, the European Commission slashed its economic forecasts, stating the eurozone will suffer an even deeper recession with GDP declining by 8.7% in 2020, down from a previous forecast of -7.7%. In Germany, factory orders rebounded weakly in May and a study found one in five firms is at risk of failure. In Japan, May’s household spending dropped 16.2% from a year earlier, the fastest rate of decline since comparable data began in 2001. (Financial Times, The Guardian, The Telegraph, BBC)
Treasury and Small Business Administration officials say the PPP program helped save 51 million jobs, according to self-reported data provided by borrowers. However, about 90,000 employers either said they would not retain any jobs despite the loans or declined to say how many they’d retain. (Finance 202)
The U.S. will pay $1.6 billion to Novavax for a coronavirus vaccine by the beginning of 2021. Meanwhile, Dr. Anthony Fauci said any vaccine would likely be limited in how long it would shield against infection. (New York Times, Bloomberg)
India surpassed Russia to become the country reporting the third-most Covid-19 cases, with more than 697,000 cases and nearly 20,000 deaths. Meanwhile, Melbourne was ordered back into lockdown for six weeks. (South China Morning Post, Sydney Morning Herald)
Britain will “have to bear the consequences” of making an enemy of China, the country’s ambassador said, warning that trade would suffer if the UK government removed Huawei from the 5G network — and adding that Chinese companies, which invested $8.3 billion in Britain last year, were “all watching.” Meanwhile, more than 40 American business groups called on Beijing to step up purchases of U.S. manufactured goods as well as energy and other products. (The Times, Wall Street Journal)
The U.S. Immigration and Customs Enforcement (ICE) announced that international students who attend college on visas will be barred from staying in the country if their school's classes are entirely online during the fall semester — as 9% of U.S. universities plan all classes online and schools like Harvard announced all-online learning. Meanwhile, colleges brace for a sharp drop in foreign students, especially from China. (Forbes, The Chronicle, Politico, Wall Street Journal)
Cell phone data show that hospital traffic is stalling again as COVID-19 cases surge. The American Hospital Association says another financial aid package is needed as they expect an additional $120.5 billion in losses this year. (HealthcareDive)
Economy & Finance
The Covid-19 crisis has fueled the appetite of insurers for alternative asset classes, particularly in private credit and private equity, as 33% plan to increase their allocation to private credit and 28% in private equity. (Private Equity Wire)
Big and mid-cap firms globally are expected to slash capital spending by an average 12% this year. The predicted cut is bigger than the 11.3% decline that occurred in 2009 and the steepest drop in the 14 years for which data compiled by Refinitiv is available. (Reuters)
The UK told the Big 4 accountancy firms to build Chinese walls between their audit and advisory teams by 2024 under a package of reforms. (The Times)
Square’s rally over the past months has pushed the digital-payment company’s market valuation into the ranks of some of the biggest U.S. banks: About $55 billion after doubling since May, making it worth more than all but four banks in the KBW Bank Index and less than $20 billion shy of Goldman Sachs’ valuation of $74 billion. (Bloomberg)
The pandemic is injecting some reluctance into the small business M&A market: Buyers and the lenders who finance deals are asking more questions and doing deeper due diligence. Seller financing, earnouts and delayed closings now get used more often to structure a deal. (MiBiz)
Technology
Chinese-owned social media platform TikTok — which serves global markets — announced it would pull out of Hong Kong, as Microsoft and Zoom also will not process Hong Kong data requests while they take stock of a new security law. These follow similar moves by Facebook, Google, and Twitter. (Reuters, BBC)
Microsoft has expressed interest in acquiring Warner Bros. games division, the publisher behind popular game franchises based on Batman, Harry Potter and other characters. (The Information)
SiriusXM is in advanced talks to acquire podcast platform Stitcher from E.W. Scripps Co. The acquisition would give the satellite radio company a foothold in the burgeoning podcast business, which is led by rival-in-audio Spotify. (Hollywood Reporter)
Zuoyebang, a Beijing-headquartered startup that runs an online learning app, raised $750 million as investors demonstrate continued focus on Asia’s booming edtech market. U.S. investment firm Tiger Global and Hong Kong-based private equity firm FountainVest Partners led the Series E financing round. (TechCrunch)
Smart Links
NYC commercial property sales volumes cratered in 2Q20. (Wall Street Journal)
Telehealth claim lines increased more than 8,335% in April. (HealthcareDive)
Under Armour is looking to sell MyFitnessPal, which it bought in 2015 for around $475 million. (The Information)
Siberian Arctic sees record average temperatures. (BBC)
‘Hamilton’ drives up Disney Plus app downloads 74% over the weekend. (Variety, Axios)