.png?width=200&height=78&name=CH%20Diligence%20(thicker%20line).png "CH Diligence (thicker line).png")
Our briefing for Friday, August 13, 2021:
Aug 13, 2021 2:34:28 PM
- In the United States, the Food and Drug Administration (FDA) has authorized Covid-19 vaccine boosters for those who are immunocompromised. Third doses of Pfizer and Moderna vaccines could now be offered to those who have been organ transplant recipients or who have equally serious medical conditions. U.S. Health officials have said those with suppressed immune systems may not be adequately protected from Covid-19 with their existing vaccines. The World Health Organization recently called for a moratorium on boosters until at least the end of September, as many developing countries are still struggling to access their first doses.
- In Canada, the country has officially entered a fourth wave of coronavirus infections, according to Chief Public Health Officer Dr. Theresa Tam. “We have been closely monitoring increases in COVID-19 activity across the country. The latest national surveillance data indicate that a fourth wave is underway in Canada and that cases are plotting along a strong resurgence trajectory,” she told reporters on Thursday. In Canada there are currently more than 13,000 active cases, more than double the number from two weeks ago. Tam says the majority of cases that are being reported daily are among people ages 20-39.
- The United Kingdom’s competition watchdog has made a statement outlining the details of its plan to investigate Covid-19 testing companies. The Competition and Markets Authority (CMA) also stated that it would be working closely with the Department of Health and Social Care (DHSC) to see what action can be taken. “This is a particularly pressing issue just now for families hoping to enjoy a well-earned holiday after such a difficult year, and for those reuniting with friends and relatives overseas,” said George Lusty, the CMA’s senior director of consumer protection. “That is why we are also providing ongoing support to DHSC, including on steps that could be considered in the interim, before the rest of our work on the PCR testing market is concluded.”
- South Korea has signed a new deal with Pfizer for 30 million more doses of the Covid-19 vaccine for 2022. Right now the country has received 17.88 million doses of the 66 million under its existing contract. Korea Disease Control and Prevention Agency (KDCA) Director Jeong Eun-kyeong said the new doses are expected to arrive in the first quarter of 2022. South Korea’s vaccine rollout has slowed, with only about 17.4% of the population fully vaccinated. On Monday, Moderna told Seoul that less than half of the 8.5 million expected doses would be delivered this month.
- In Japan, Tokyo saw a record-breaking 5,773 daily new cases, surpassing the previous record of 5,042 set last week. Despite the Olympics being over, cases numbers in Japan continue to rise and have topped 10,000 for more than a week now. Prime Minister Yoshihide Suga continues to rule out any connection between the Olympics and the rise in cases. The Paralympics, which are scheduled to begin on August 24, will ban spectators from almost all events. Tokyo remains under a month-long state of emergency, although many are choosing to ignore government requests to stay at home.
- In Australia, the capital city of Canberra entered a snap one-week lockdown on Thursday evening, after reporting its first locally acquired case of Covid-19 in more than a year. Canberra has largely been without any Covid-19 cases since the beginning of the pandemic, but officials say the lockdown was still necessary. Meanwhile in New South Wales, case numbers reached 390 with most cases being in Sydney. As case numbers rise, the less likely it becomes that Sydney will end its nine-week lockdown on August 28 as planned. Authorities have said that lockdowns will be needed until at least 70% of adults are fully vaccinated.
Covid-19 – Due Diligence And Asset Management
Fast-spreading COVID-19 Delta variant is starting to hit corporate America
Brief: The stock market continues to ignore worsening headlines on the COVID-19 Delta variant front and climb to fresh records. But given a shift in tone lately from corporate America, perhaps investors should be on high alert. Companies that had been bullish on the economic recovery from the depths of the pandemic are becoming increasingly cautious as the variant spreads. Here are three household names that have recently warned of a financial impact from the COVID-19 Delta variant. Investors may be ignoring the commentary below, but it could prove to be an earnings headwind in the current quarter — one that isn't priced into stock prices.
Pandemic Deals Surge Boosts U.K. Law Firm Revenue to Fresh Highs
Brief: A surge in merger activity propelled profits at the U.K.’s largest law firms despite a collapse in the global economy triggered by the coronavirus pandemic. A year that started with virus-related uncertainty gave way to record deal activity that helped four elite London firms, known as the Magic Circle, report bumper financial results. Transactional lawyers around the world advised on over $4 trillion worth of deals in the year ending April 31, according to data compiled by Bloomberg. Freshfields Bruckhaus Deringer led the way posting a 5% revenue boost to 1.6 billion pounds ($2.2 billion) for the financial year -- much of the growth was attributed to their work on eye-catching deals. Those included AstraZeneca Plc’s $39 billion acquisition of Alexion Pharmaceuticals Inc. and the sale of Cazoo for $7 billion, one of the largest ever SPAC deals.
U.S. consumer sentiment plummets in early August to decade low
Brief: U.S. consumer sentiment dropped sharply in early August to its lowest level in a decade as Americans gave faltering outlooks on everything from personal finances to inflation and employment, a survey showed on Friday. The University of Michigan said its preliminary consumer sentiment index fell to 70.2 in the first half of this month from a final reading of 81.2 in July. That was the lowest level since 2011, and there have been only two larger declines in the index over the past 50 years. Economists polled by Reuters had forecast the index would remain unchanged at 81.2. U.S. stock market indexes slipped immediately after the report was released, while the price of gold, a safe-haven investment, gained ground. U.S. Treasury bond yields hit session lows. Economic growth is still expected to grow this year at its fastest pace in four decades after falling into a brief recession in 2020 caused by the coronavirus pandemic.
Philippines Covid Surge Spurs Worst Stocks Rout Since June 2020
Brief: Philippine stocks tumbled the most in more than a year on fears coronavirus infections will rise further and spur the government to extend a two-week lockdown affecting the capital and other areas. The Philippine Stock Exchange Index plunged 3.6% to 6,320.19 at 1 p.m. in Manila, its lowest close in more than a year. Investors dumped key blue chips -- including SM Investments Corp. and unit SM Prime Holdings Inc. -- after the gauge had held a moderate decline for much of the day. “I was expecting a downward movement, but not this drastic,” said Manny Cruz, strategist at Papa Securities. “The fear is infections will further escalate, raising prospects the lockdown will run longer.”
Short-sellers have been the ‘secret ingredient’ to the market’s Covid rally, says Jim Cramer
Brief: CNBC’s Jim Cramer said Thursday short-sellers have helped propel Wall Street’s robust rally from its pandemic-driven sell-off, calling the cohort of bearish investors the “secret ingredient” to the stock market’s success since late March 2020. “Just like ordinary investors will throw in the towel and sell when their favorite stocks get obliterated, short-sellers throw in the towel when their favorite targets go up too much,” the “Mad Money” host said, shortly after the Dow Jones Industrial Average and S&P 500 yet again closed at record highs. “The invisible cover of their defeat is evident every day in this market and it’s something we don’t talk about enough—how the heck do you think we’ve managed to go six straight months without a 5% decline? Capitulating short-sellers are like a fifth column supporting the bulls, even if they’re not doing it by choice,” he added.
