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Our briefing for Tuesday, August 10, 2021:
Aug 10, 2021 3:52:04 PM
- In the United States, vaccines will now be mandatory for members of the U.S. military. The White House and Pentagon announced on Monday that approximately 750,000 members will be required to get the shot. “Being vaccinated will enable our service members to stay healthy, to better protect their families, and to ensure that our force is ready to operate anywhere in the world,” President Joe Biden said in a statement released by the White House. About half of the U.S. armed forces are already fully vaccinated, compared with about 60% of the U.S. population.
- In Canada, reopening plans are unfolding across the country as vaccination rates creep up. New Brunswick, P.E.I., Manitoba, Saskatchewan and Alberta have all relaxed their masking rules. Ontario and Quebec still require masks and social distancing in indoor spaces. Quebec extended hours for bars and restaurants and increased capacities for social gatherings. Nova Scotia is in its fourth phase of reopening, which means retail stores can operate at full capacity while churches and other venues can operate at half capacity. British Columbia removed most Covid-19 restrictions on Canada Day and now allows for outdoor gatherings of up to 5,000 people
- In the United Kingdom, Britain will ease some travel restrictions for those delegates attending the UN Climate Conference in Scotland in November. Following the U.K.’s traffic light system, those delegates attending from “red list” countries will be required to self-isolate for only 5 days if they are vaccinated, and for 10 days if they are unvaccinated. The British government is offering vaccines to all attendees, and all vaccines will be recognized. There are about 20,000 people expected to attend from 196 different countries. The conference is the largest public event that the U.K. has hosted since the 2012 Olympics.
- In Italy, police had to crackdown on a network of people who were selling fake Covid-19 health passes online. According to a statement by police on Monday, the sellers were offering fake versions of the pass for up to 500 euros ($588) in cryptocurrency or online shopping vouchers. Italy launched their green pass on Friday, which shows if someone has received one dose of vaccine, had a negative Covid-19 test or recovered from Covid-19 in the past six months. The green pass is required for access to indoor venues like gyms and restaurants, and in September it will be mandatory for all university students and for travel.
- In Japan as the Olympic games drew to a close on Sunday, experts were left to wonder whether Japan’s surge in cases had any link to the games. Inside the Olympic “bubble,” a total of 430 new coronavirus cases were reported as of Sunday. The International Olympic Committee (IOC) and Prime Minister Yoshihide Suga have both said there is no link between the games and the surge in cases. Some analysts, however, have said that it’s too early to draw any conclusions about the outcomes.
- In Australia, the city of Sydney saw its worst day of this pandemic outbreak yet, even as it entered its seventh week of lockdown. New South Wales reported 356 new cases, up from 283 the day before. “We know New South Wales is going through challenging times but we also know that vaccination is a key tool in reducing the spread and preventing hospitalization,” state Premier Gladys Berejiklian told reporters on Tuesday. Australian authorities have also said they will ramp up the country’s sluggish vaccination campaign in an effort to start opening international borders next year.
Covid-19 – Due Diligence And Asset Management
German Investor Confidence Plunges Amid Virus Variant Concerns
Brief: Investor confidence in Germany’s recovery dropped to the lowest level since late last year after a rise in infection rates stoked concerns over a possible tightening of pandemic curbs. ZEW’s gauge of expectations declined to 40.4 in August from 63.3 the previous month, with the institute’s President Achim Wambach warning of “increasing risks” to the economy. A measure of current conditions improved. Although more than half of Germany’s population is fully vaccinated, coronavirus infections in Europe’s largest economy are on the rise. The government has already tightened some travel rules and is set to discuss additional steps during a summit on Tuesday.
Tech drop exposes doubts in U.S. growth optimism
Brief: Slumping technology stocks briefly slowed the grind higher in U.S. equities, exposing the lingering concerns about the ability of the economy to weather less stimulus and rising COVID outbreaks. While the S&P 500 climbed to another all-time high, the Nasdaq 100 declined as Amazon.com slumped. Micron Technology led a decline in chip stocks, which are down for a fourth session. Energy shares rallied with oil. In Europe, the Stoxx 600 Index climbed for a seventh day.“The move lower in growth, especially the tech sector, may be two-fold,” said Dave Mazza, head of product at Direxion. “First, with the recent outperformance in the space, investors may be taking profits ahead of this week’s inflation data. Secondly, investors may be pricing in tapering by the Federal Reserve sooner then expected considering recent comments from officials.”
Global M&A activity rebounded forcefully in Q2
Brief: Global M&A activity saw a strong recovery in H1 2021, as dealmaking count and value are both set to reach or surpass the record highs of previous years, according to Pitchbook's latest Global M&A report. In total, more than 17,000 deals closed with a combined value exceeding USD2 trillion, as the bounce back from the pandemic-spurred lows in 2020 continued to pick up slack. Healthy stock market returns, optimistic executives, and cheap financing were all contributing factors to the deal bonanza, the report, which mapped M&A activity in the first half of the year, revealed. Moreover, the intense pace of IPOs and SPAC reverse mergers bodes well for global M&A activity overall.
European markets edge higher as caution lingers over Covid-19
Brief: European stocks inched higher on Tuesday, looking to break out from a cautious approach seen globally at the start of the week. The pan-European Stoxx 600 climbed 0.25% by late morning, with travel and leisure stocks adding 1.4% to lead gains while banks fell 0.6%. The cautious optimism in Europe reflects similar sentiment in Asia-Pacific, where shares mostly rose in Tuesday trade while South Korean game developer Krafton plunged in its debut. Worries about the impact of Covid on global growth continued to weigh on investor sentiment, with countries grappling with the spread of the highly transmissible delta variant of the virus.
Even in crisis, most cryptocurrencies offer diversification benefits
Brief: During times of global turbulence, like the kind induced by the Covid-19 pandemic, cryptocurrencies may provide much-needed diversification to investment portfolios, according to a paper from researchers at the University of Bath. The researchers came to this conclusion after aggregating popular cryptocurrencies into nine equally-weighted portfolios based on the type of algorithm used in the blockchain of each currency, a methodology that gave them room to consider 553 cryptocurrencies in total. These categories included proof-of-work coins — popular mineable coins like Bitcoin and Ethereum — and proof-of-stake coins, a more energy-efficient alternative to PoW coins.
