US Stock markets on Monday closed higher driven by news that Trump’s Government would unveil another economic relief package in July. This was despite an announcement earlier in the day by the US National Bureau of Economic Research that the country had officially entered a recession.
“The committee recognizes that the pandemic and the public health response have resulted in a downturn with different characteristics and dynamics than prior recessions,” the NBER’s said in a statement seen by the Kenyan Wallstreet.
At the closing session, the Dow Jones rose 1.70% with shares of Boeing surging by more than 12% according to data from FX Pesa. The Nasdaq 100 continued with its spectacular performance closing in at a record high with shares of Tesla rising 7% to hit a record high. The S&P 500 gained marginally while erasing the losses made during the year.
Major News Highlights
- The world bank on Monday released its June 2020 Global Economic Prospects report warning that the pandemic might bring about the deepest recession in decades since the second world war. Its said the crisis will affect the global economy mostly “through lower investment, an erosion of human capital through lost work and schooling, and fragmentation of global trade and supply linkages”.
READ; Global Economy Plunges into Worst Recession – World Bank
- The Austrian Government has entered into an agreement that will enable the country’s airline to receive a bailout package totalling €600 million in a rescue package. Austria will provide 450 million euros, with the rest coming from German giant Lufthansa, of which Austrian Airlines is a subsidiary. Furthermore, the Austrian government and the German airline agreed that Austrian Airlines headquarters must remain in Vienna for at least 10 years according to AFP.
- Chinese E-Commerce company Alibaba Group has announced plans to hire about 5,000 additional staff for its cloud arm. The global program will run till the end of its financial year which ends in March 2021. The company in May reported its earnings with revenue for the final quarter of 2020 rising by 22% to $16.14 billion. Net income fell 99% to $49 million driven by a net loss in investment income. More Details here
- Energy markets fell on Monday despite an agreement over the weekend by OPEC and its allies to extend production cuts until the end of July. Meanwhile, Bloomberg reports that Libya’s largest oil field has resumed production after a five-month hiatus. The El-Sharara oilfield is expected to add more than 300,000 barrels of oil a day to the global market.
RELATED; OPEC & Allies Agree to Extend Oil Cuts By One Month
