The World
Moderna’s Covid-19 vaccine led patients to produce antibodies that can neutralize the novel coronavirus that causes the disease, though it caused minor side effects in many patients. Moderna is one of the leaders in the vaccine race, along with Oxford University and AstraZeneca, whose vaccine candidate is already in Phase III trials in the U.S., Brazil, and South Africa. (Stat, NEJM, Reuters)
The U.S. economy is headed for a tumultuous autumn, with the threat of closed schools, renewed government lockdowns, empty stadiums and uncertain federal support for businesses and unemployed workers all clouding hopes for a rapid rebound from recession. Meanwhile, Morning Consult’s U.S. Index of Consumer Sentiment fell to 86.85 amid the new surge of coronavirus cases. Households making at least $100,000 drove the recovery in May and June, but now lead the index’s recent fall. (New York Times, Morning Consult)
65,000 new cases were reported in the U.S., and California and Texas each set daily records with more than 10,000 new cases. More than 130 people died in Florida and Texas, the worst day yet for both states. Meanwhile, only 2 of the nation’s 10 largest school districts (NYC and Chicago) don’t sit in counties that exceed the standard generally agreed upon among epidemiologists for reopening. Walmart will require face masks at all U.S. stores starting Monday. (New York Times, New York Times, Washington Post)
Faulty data collection is raising questions about PPP program claims, as borrowers and bankers say the SBA released false and sometimes inflated figures. A Post data analysis shows that many companies are reported to have “retained” far more workers than they employ. In other cases the agency’s jobs claim for entire industries surpasses the total number of workers in those sectors. (Washington Post)
The U.S. said it will back nations whose South China Sea claims China violated, while China said it will sanction U.S institutions and individuals after President Trump signed an executive order and new law requiring punitive measures over Beijing’s handling of Hong Kong. Meanwhile, as China hits out at the UK’s Huawei ban, British politicians complain that PM Boris Johnson did not go far enough. Separately, the New York Times will move part of its Hong Kong office to Seoul. (Reuters, South China Morning Post, Nikkei Asian Review, South China Morning Post, New York Times)
In the UK, the Office for Budget Responsibility warned that more than 4 million people could be out of work at the end of 2020 as the taxpayer-backed furlough scheme shuts down. (Daily Telegraph)
Apple won a major legal victory against European antitrust regulators as the EU’s second-highest court overruled a 2016 decision that ordered the company to pay $14.9 billion in unpaid taxes to Ireland. Google and Amazon have other court appeals pending. (New York Times)
Economy
U.S. CEOs’ forward confidence in business conditions continued an upward climb. At 6.6 out of 10, CEO confidence is now nearing January’s level (6.7), just before the crisis struck. Confidence in the current economic environment is also rising, adding 13% to last month’s gains, although it remains 26% below its January level. (Chief Executive)
Mortgage rates fell to another record low last week, while homebuyers took a step back. However, new mortgage delinquencies hit a record in April, as 3.4 percent of Americans became at least 30 days delinquent on their mortgage. (CNBC, Washington Post)
Goldman Sachs’ $2.4 billion quarterly profit blew past estimates, bucking larger commercial banks that saw earnings plummet and reflecting a flood of corporate fundraising and torrid trading markets. Quarterly revenue was the second-highest on record at $13.3 billion. (Reuters, Wall Street Journal)
2Q20 fundraising remained strong as VC mega-funds ($500 million+) have been especially prolific in 2020 with 24 closed so far, which nearly equals the full-year number for 2019. Deal activity has been mixed with the overall deal count dipping while strength in late-stage financings sustain aggregate capital investment. 1H20 has seen a more subdued market for VC liquidity than in 2018 and 2019. Exit count in 2020 is tracking to be the lowest since 2011, and value is pacing to drop back toward the levels seen pre-2017. The short-term aspect of this drop in liquidity is crucial, as an extended economic decline would change some longer-term behaviors around commitments to VC. (Pitchbook)
Private equity firms invested in a record 464 companies in Central and Eastern Europe in 2019, as investments increased 7% year-on-year to €2.95 billion. That’s the second-highest total ever recorded, with the number of companies up 10% on the previous year to a new all-time high. (FinSMEs)
46% of remote workers aren’t comfortable returning to offices before a vaccine is available. (CivicScience)
Technology
India growth: Walmart is increasing its majority-stake in Flipkart, leading a $1.2 billion financing round in the Indian e-commerce giant just days after Google said it would invest $10 billion in India and reports revealed Google’s may invest $4 billion in Jio Platforms. Meanwhile, India posted its first trade surplus in 18 years. (TechCrunch, Reuters)
TikTok agreed to buy more than $800 million in cloud services from Google, which has fewer marquee customers to boast of than rivals Amazon Web Services and Microsoft. The three-year agreement was signed in May 2019. (The Information)
More than 2,500 mobile games were removed from Apple’s China app store in the first week of July, four times as many in the same period in June, after Apple closed a loophole to comply with Chinese license requirements. (Reuters)
Coronavirus is hastening the rise of the cashless economy: Cashless transactions have spiked as company policies and consumer habits shift. (CityLab)
Smart Links
The pandemic’s impact on M&A — and what will happen next. (Chief Executive)
Private markets may provide small businesses better funding options than the Fed. (New York Times)
World population is set to fall for the first time. (The Lancet)
Google search gives preference to YouTube videos. (Wall Street Journal)
ICE to rescind regulations regarding international students. (NPR)
New supersonic jet is set for 2021 take off. (CNN)