Spending data, Buffet’s Texas gamble, WeWork’s SPAC deal – What’s happening in the markets? By Investing.com


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Yazar: Geoffrey Smith

Investing.com – Global progress in placating Covid-19 is becoming more and more different as President Joe Biden doubles its vaccination target. While personal income and expense reports will be released, the blockade of the Suez Canal may attract more attention than ever to the monthly retail and wholesale stock figures. WeWork will go public through SPAC (merger-purpose partnership). The Fed lifts stock buyback restrictions on banks.

What you need to know in financial markets on Friday, March 26th:

1.Covid-19 differences widen as Biden doubles the vaccination target

Progress in the world in containing the Covid-19 outbreak is slowing as regional performance differentiates more sharply than ever before.

With new infection rates seeming to plummet in recent days, the US seems to be the most likely name to join China in bringing the disease under control. President Joe Biden said at the first press conference on Thursday that he now has a target of 200 million vaccines in the first 100 days, upgrading his new program to vaccinate the US population. The first 100 million targets have been achieved.

However, in the EU, the number of cases continues to rise in all major economies north of the Alps. German Health Minister Jens Spahn warned on Friday that there are “clear signs” that the last virus wave will be worse than the first two. This contrasted with the stronger-than-expected increase in German business confidence in March: the IFO index saw a two-and-a-half year high.

The number of cases in India and South America continues to rise.

2.Personal income and expenditure data

The new data will show the impact of recent stimulus checks passing through the economy like a pig going through a python.

The February reading of US personal income and expenditure data will be shared at 15.30 BST. Revenue is expected to decline 7.3% after the 10% increase in January, while the expectations for personal spending are 0.7% decline, following a 2.4% increase last month.

There will also be personal consumption expenditures price index, which is the Fed’s choice of measurement for inflation, and the Michigan Consumer Sentiment survey.

3.The exchanges will open high, WeWork goes public with SPAC

US stock markets will open with slight increases but not enough to be in the green zone on a weekly basis. Despite showing a 0.5% increase, it is preparing for its fifth red week in six weeks.

While it rose 77 points, it increased by 0.3%.

Another name that might attract attention is Berkshire Hathaway (NYSE :). Warren Buffett’s company has made a $ 8.3 billion plan for government regulators to build an emergency backup power generator in Texas.

Apart from that, according to the Wall Street Journal, the office rental company WeWork is the Merger Purpose Partnership Company (SPAC) BowX Acquisition Corp. agreed to go public with a value of around $ 9 billion, including debt. This figure is less than 20% of the value it had in the private funding round in 2019 before a traditional initial public offering (IPO) venture failed.

4.Fed to end bank payment restrictions

The Fed pointed out that the risk of the epidemic to the stability of the banking system is at its peak. He said on Thursday that when the pandemic started a year ago, most banks would lift the restrictions they had imposed on dividend and stock buyback activities.

After setting aside tens of billions of dollars in provision for potential loan losses, the bank results picked up in the third quarter, and in the last quarter it looked like they were shaking again.

The bans will be lifted on June 30, but will remain in effect for another three months for any bank that is presumed to have a capital shortage in the Fed’s current stress test round, whose results will be released at the end of June.

A week ago, the Fed effectively ended a temporary stretch in the capital rules established at the beginning of the epidemic.

5.Oil recovering, Suez blockade will continue until next week

According to various reports, the Suez Canal, one of the most important waterways in the world, will continue to be congested until the middle of next week at the earliest.

According to reports, a high wave expected on Saturday will likely not be enough to save the Ever Given container ship stuck in the side wall of the Suez Canal.

Bloomberg reported that the number of ships waiting to enter the Channel increased from 185 on Thursday to over 300 now. This can lead to significant disruptions in the supply chain of everything from oil to liquefied plastic to pulp. Even though it rises 1.5%, it is on the way of ending the week low.

Ongoing problems in Suez may cause more attention to the US and retail wholesale stock data than ever before.

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