June 22. Home sales in the US secondary market in May decreased by 9.7%, worse than forecast

Today in the United States published a report of the National Association of Realtors (NAR), traditionally important for the dynamics of the US dollar in the context of the crisis caused by the coronavirus pandemic. According to recent data, home sales in the secondary market in May fell by 9.7% compared with April, to 3.91 million.

Analysts polled by Reuters expected a 3% drop in the number of such deals, to 4.12 million.

In addition, the share of distressed real estate in this market in May amounted to 3%, which generally corresponds to the level of April, but above 2% in May 2019. Sales of single family homes amounted to 3.57 million, in monthly terms there was a decrease of 9.4%, in annual terms – by 24.8%.

June 25. The final estimate of US GDP in the I quarter: a fall of 5%

According to the final estimate of the US Department of Commerce, the country's GDP in the first quarter fell by 5% in annual terms. The indicator coincided with the forecasts of analysts and the second assessment of the department. The first estimate suggested a decrease of only 4.8%. At the same time, exports fell by almost 9% and imports by 15.7%.

In the first quarter of 2019, US GDP growth in annual terms was 3.1%, in the second – 2%, in the third – 2.1%, in the fourth – also 2.1%.

The decrease in US GDP was noted for the first time since the first quarter of 2014, when this decrease amounted to 1.1%. It also became the strongest since the fourth quarter of 2008, when the country's economy shrank by 8.4%. Experts point out that social isolation measures in response to the coronavirus pandemic had a negative impact on the American economy in the spring of 2020.

June 29. More than 40% of S&P 500 companies abandoned forecasts due to coronavirus

More than 40% of the S&P 500 companies withdrew quarterly or annual forecasts due to the uncertainty surrounding the outbreak of coronavirus. As the reasons, some of them noted the likelihood of new outbreaks of the disease, changes in consumer behavior and additional costs.

According to The Wall Street Journal, the stocks of the companies that made this decision have fallen in price by 18.2% since the beginning of the year, while the S&P 500 value fell by 6.9%. Many companies that have withdrawn forecasts are most affected by the industry pandemic – the telecommunications, entertainment, automotive, and industrial goods sectors.

However, among these companies there are those who have benefited from the effects of the pandemic. For example, this is the Kroger Co. supermarket chain, whose sales have jumped, and capitalization has increased by almost 13% since the beginning of the year. Payment system PayPal Holdings Inc. over the period of the pandemic, it added 58% against the backdrop of an increase in online trading.

Uncertainty is also associated with the lifting of quarantine measures in the United States. Texas and Florida reinstated some restrictions last week due to a spike in new cases. Many S&P 500 companies updated their forecasts due to a coronavirus outbreak: 154 companies worsened expectations in at least some indicators, while 28 improved forecasts.

July 02. The number of jobs in the US in June jumped to a record 4.8 million

According to the US Department of Labor, in June the number of jobs in the economy increased by 4.8 million. This growth was a record since the beginning of statistics in 1939. Experts on average predicted job growth of 3 million.

Experts note the gradual recovery of economic activity in the country, following the partial lifting of quarantine measures. In March and April, the American economy lost about 22.2 million jobs.

However, few people expect a quick recovery: many believe that the official data does not reflect the real scale of the losses, since a large number of people are considered to be employed, but they are not able to work due to continuing restrictions. In addition, there remains a high risk of a second wave of the epidemic not only in the United States, but throughout the world.

The number of jobs in the private sector grew by 4.767 million in June, while in the public sector by 33 thousand. Industrial enterprises increased the number of employees by 356 thousand.

July 08. The EC approved the plans of Germany to allocate 500 billion euros to help companies

The European Commission has announced that it has approved a plan by Germany to create a fund of 500 billion euros to help companies affected by the coronavirus pandemic. It is noted that with the help of this fund, companies will be able to get temporary access to government loans and investments.

The EC stated that it continues to work closely with EU member states in finding solutions to support and finance European companies, subject to all EU rules.

EC Executive Vice President Margret Westagher, who is responsible for competition policy, emphasized that assistance to companies will be determined by the necessary measures that will ensure compliance with competition rules.

15.07. Mexico announces completion of OPEC+ commitments and increased production

Mexican President Andres Manuel Lopez Obrador said the country has fulfilled its part of the OPEC+ deal and intends to begin to increase oil production. Mexico has already reduced production by 100 thousand barrels per day.

According to the agreement, Mexico reduced production by 9.7 million barrels per day from May to the end of June. In July, the contract was extended until the end of July. Since August, OPEC+ member countries are expected to reduce production by 7.7 million barrels for the period until the end of the year and by 5.8 million by the end of April 2022.

23 countries are involved in the agreement, however, Mexico initially insisted on separate commitments, agreeing to reduce production only in May-June by 100 thousand barrels per day instead of the 400 thousand offered to it.

It should be noted that in May Mexico even exceeded its obligations to the alliance: the commitment to the deal was 120%. And according to the International Energy Agency (IEA), in May the country exceeded its obligations even by 65%. In June, Mexico executed the OPEC+ deal 100%.

July 21. India intends to store crude oil in the US

Authorities have announced that the country plans to store part of its crude oil reserves in the United States.

The government notes that India needs new strategic oil reserves of its own, but building them could take several years and huge financial resources.

The way out of the situation was the opportunity to rent American strategic storage facilities, moreover, that this would not entail large expenses. The oil that will be stored in the United States can be used by New Delhi both for its own needs and for sale on the world market. However, if oil prices fall during storage, India will suffer losses.

July 23. Britain and the EU have not agreed on the basic principles of relations

The UK's chief Brexit negotiator David Frost said today that Britain and the EU have failed to reach agreement on key issues for a future trade deal. However, the politician still hopes for a successful conclusion of the negotiations in September.

Michel Barnier, the EU's chief Brexit negotiator, also noted that there is a high risk of not reaching any agreements with Britain. He also said that the current position of Britain in negotiations on a future partnership makes the possibility of a trade agreement unlikely. It is about the UK abandoning open and fair competition and a balanced fisheries agreement.

The next stage of negotiations is scheduled for August 17.

July 28. Fed extends lending programs until December 31

A two-day meeting of the US Federal Reserve System starts today, following which the regulator will make public its decision on the rate and further monetary policy.

At the end of the first day, the central bank announced that it is extending operations on seven emergency lending programs by three months, until December 31, in order to maintain activity during the coronavirus pandemic.

These programs were initiated in March and April until September. Program extensions should facilitate planning for potential program participants and provide certainty that these programs will continue to be available.

July 31. EU GDP collapses by record 14.4%

According to the statistical agency Eurostat, the GDP of the EU countries in the II quarter fell by 14.4% in annual terms. On a quarterly basis, the indicator decreased by 11.9%. In the first three months of the year, the EU economy contracted by 3.6%. Figures like these signal that the European economy has entered a recession.

Earlier in July, the European Commission presented its forecast for changes in Europe's GDP: experts expected the economy to decline by 8.3%.

At the same time, the economies of 19 eurozone countries contracted by 12.1% in the second quarter and by 15% – in annual terms. Analysts had expected a decline of 11.2% and 13.9%, respectively.

The fall in all indicators has become the sharpest and strongest since 1995 – since the beginning of statistics.

August 04. Gold rises in price on increasing geopolitical risks

On Tuesday evening, the price of gold started to rise sharply, reaching $ 2.001 per troy ounce. The growth driver was fears of further deterioration in relations between the United States and China.

Market participants continue to follow the news around the TikTok app, owned by the Chinese company ByteDance. Earlier, it became known that US President Donald Trump announced plans to ban TikTok on the grounds that this Chinese company, by law, must transfer user data to the PRC authorities.

Trump's actions are forcing TikTok to sell its US assets to an American company, which was seen by the Chinese authorities as another provocation and led to increased tensions between the two countries.

As a result, market players prefer to ditch risky assets in favor of safer ones, which traditionally include gold.

August 07. US: 1.8 million jobs added in July, unemployment falls to 10.2%

According to the US Bureau of Labor Statistics, only 1.763 million jobs were created in the nonfarm economy. This signals that the recovery of the American economy after the coronavirus pandemic has slowed in July.

Forecasts assumed growth of 1.6 million jobs. Despite the fact that the current data exceeded analysts' expectations, there is a decrease in job growth compared to the jump in the previous month, when 4.791 million people were hired.

The report also reflected the current state of unemployment in the country. To date, the unemployment rate has dropped to 10.2% of the total working-age population, after 11.1% in June. Analysts predicted the growth rate to 10.5%.