The World
European leaders were struggling to save a vast rescue fund as talks entered a fourth day with President Macron of France thumping the table in frustration as late-night negotiations became increasingly heated. The leaders are talking about spending around Euros 750 billion to revive the bloc’s economy. What was planned as a two-day summit scheduled to end on Saturday has exposed deep ideological differences between the 27 leaders, forcing the talks into two extra days. (The Times)
The U.S. labor-market recovery is losing momentum amid heightened employer uncertainty and consumer caution. Millions of Americans who managed to hold onto their jobs have seen their incomes drop as employers slashed wages and hours to weather what they expected to be a short-term shutdown. More than six million people enrolled in food stamps in the first three months of the pandemic, an unprecedented expansion. (Wall Street Journal, Politico, New York Times)
China is launching new amphibious assault ships and beefing up its Marine Corps. Its main aim is to project power far from home, but it is also strengthening its ability to invade Taiwan. Meanwhile, the UK signaled it will join allies in suspending its extradition treaty with Hong Kong, while China responded that any UK move to suspend extradition treaty interferes in domestic affairs and will meet retaliation. Separately, China indicates it may retaliate against Nokia, Ericsson if EU countries ban Huawei. (Reuters, Financial Times, South China Morning Post, Wall Street Journal)
In its first human trial, AstraZeneca’s experimental COVID-19 vaccine — developed with University of Oxford scientists — was safe and produced an immune response in early-stage clinical trials in healthy volunteers, with the strongest response seen in people who received two doses. Meanwhile, a British drug developed at the University of Southampton dramatically reduced the chances of coronavirus patients needing intensive care, according to preliminary results of a randomized trial. (Reuters, The Times)
U.S. companies are raising new questions about how they can make workplaces safe after the World Health Organization acknowledged that tiny airborne droplets may contribute to the virus spread. Meanwhile, Delta announced new screenings for passengers who can't wear masks and asked them to consider staying home, as the Bahamas bans U.S. tourists. (Reuters, CNN, The Hill)
Tens of thousands of workers nationwide are expected to walk off the job today in solidarity with the Black Lives Matter movement. (Washington Post)
The UK’s carbon emissions have begun to rebound following the easing of lockdown measures, causing the “carbon savings” triggered by the coronavirus to halve within weeks. (The Guardian)
Economy
The tea leaves of the world’s biggest bond market are producing a much-more foreboding reading than those of U.S. stock prices. America’s equity indexes are holding well above their pandemic-induced 2020 lows, yet the Treasury market increasingly is foreshadowing doubt over the pace of the economic rebound. Ten-year real yields, considered a more-pure read on growth since they strip out inflation, have dropped for the past six weeks and hover at about -0.85%. (Bloomberg)
In derivatives, bullish U.S. options trading suggests that caution has been ‘thrown aside,’ as data show rising volumes of rights to buy stocks, rather than sell. (Financial Times)
While Covid-19 – and its economic impact – remains an uncertain presence, there are signs that private equity activity is starting to pick up, according to a new report from Bain & Company. Private equity firms returned to the deal table in June – in a virtual sense at least – with some general partners “seeking out opportunities to buy assets at the cycle’s nadir”, Bain’s report said. The number of deals in June were nearly double what was recorded in April. (Private Equity News)
Jack Ma’s Ant Group, valued at US$200 billion, will kick start concurrent IPOs in Shanghai and Hong Kong, bypassing New York, making it more valuable than state-owned China Construction Bank and just shy of Bank of America. Ant Group has acquired 200,000 clients in the first 100 days since the launch of the investment advisory partnership. (South China Morning Post, Financial Times)
As the world’s most valuable exchange group, the Hong Kong Exchange is at the center of the city’s global financial appeal. But Beijing’s tightening grip on the city and rising geopolitical tensions mean that HKEX has a lot to lose — and, potentially, even more to gain. (The Wire China)
Provided that health across the global population continues to improve over the next two decades, a new McKinsey report — Prioritizing health: A prescription for prosperity — estimates that an additional 230 million people would survive by 2040, significantly bolstering the workforce. The combined economic benefits of a bigger and more productive labor force could add up to an 8% jump in the GDP leading up to 2040, according to the report, adding $12 trillion in absolute terms. (Consulting.US)
Technology
Disney dramatically slashed its advertising spending on Facebook, while pausing advertising of its streaming-video service Disney+. Disney also paused spending on Facebook-owned Instagram for its sister streaming service Hulu. (Wall Street Journal)
Tech M&A Takeover Target List: The pandemic has squeezed many businesses and made funding harder to get. Postmates sold to Uber and Grubhub sold to Europe’s Just Eat Takeaway. Meanwhile, EW Scripps sold a high-growth business—podcasting firm Stitcher—to raise badly needed cash. Many more deals are possible. ByteDance selling TikTok now seems quite possible. It’s also easy to imagine Jeffrey Katzenberg trying to sell Quibi. The challenge for this kind of high-profile consumer internet firm will be on the buyer side: The antitrust scrutiny already focused on big tech firms like Facebook, Amazon or Apple likely limits their ability to make big acquisitions. (The Information)
Why Peloton will win the biggest work-from-home experiment in history: The fitness company is pedaling its way to over $1 billion in revenue this year. (Marker)
India's Reliance is seen emerging as bigger threat for U.S. firms like Amazon and Walmart: A $20 billion fund raising spree may take India's Reliance closer to its dream of becoming a digital giant, further threatening the ambitious plans U.S. companies like Amazon, Walmart and Zoom have for India. (Reuters)
Smart Links
Tim Cook’s careful but profitable dance with the White House. (Fast Company)
The United Arab Emirates launched its first ever mission to Mars from Japan’s Tanegashima Space Center at 6:58 am local time. (MIT Technology Review)
More than half of UK manufacturers expect to make job cuts over the next six months. (Financial Times)
Selling New York’s luxury residences is a supertall order. (Financial Times)
Top CEOs agree that culture is the key before, during and after crisis. (Forbes)