The 5 most important events affecting the global stock exchange today, June 9
The United States is in recession, as the World Bank predicts a decline in global production by 5.2% during the current year 2020 , although the Nasdaq remains at its highest level ever .
Regarding oil prices, it is expected that the Crude Oil will give up some of its recent gains .
While the IPO market is preparing to receive shares Vroom During this busy week .
Here's what you should know in the financial markets during today Tuesday.
The United States of America is officially experiencing a recession
The United States has been officially declared to be in recession as a result of the social divergence measures taken by the country following the spread of the Corona virus, which began to be applied during February, ending the longest period of economic expansion in the United States of America .
Late Monday, the National Bureau of Economic Research, which represents the governing body for business cycles in the United States of America, stated that " the unprecedented size of the decline in the rate of employment and production, and its widespread penetration in all aspects of the economy, requires recognition of the country's entry into a phase Stagnation, even if it turns out to be shorter than previous contractions . "
This recognition was not surprising. In the end, the GDP of the United States of America decreased by 4.8% year on year during the first three months of the year, and the coming quarter is expected to be much worse . At the same time, the unemployment rate rose from the record low level by 3.5% during the month of February, to reach 14.7% during the month of April, and 13.3% during the last month .
This highlights the two-day Federal Reserve meeting, which is scheduled to end tomorrow, Wednesday, to learn more about future stimulus .
Global production faces the threat of an outbreak of the Corona virus during the current year 2020
The Corona virus epidemic may have peaked . New York City, which used to be the epicenter of the epidemic in the United States of America, started a relatively slow process of reopening business last Monday . But it is also important not to ignore the damage caused, as more than 7 million people have been affected , and more than 400,000 people have died so far . Moreover, the economic impact of that epidemic should be studied .
On Monday, the World Bank said in its latest report on global economic prospects that global economic output will contract by 5.2% during the current year 2020 due to the spread of the Corona virus . The report also said that advanced economies are expected to contract by 7% during the current year 2020 , while emerging market economies will contract by 2.5% , which is the first contraction rate since total data became available in 1960.
These expectations indicate a deeper slowdown than the estimates issued by the International Monetary Fund during the month of April, as it expected a global contraction of 3% during the current year 2020.
Expectations of a decline in US stock markets
The US stock markets are expected to open their trading lower today, in light of the investors 'willingness to take profits after yesterday's earnings confirmed the rise of the market according to the Nasdaq Composite Index led by technology companies .
By 6:30 am (10:30 GMT ) , the Dow Jones futures contracted by 316 points, or 1.2% , for the S&P 500 futures to fall by 1% , and the Nasdaq 100 futures slipped 0.6%.
It is worth noting that the Nasdaq index jumped by more than 40% from its lowest level reached on March 23 , to reach a new high and confirms the emerging market, which is considered to have started at the lowest level of the index, after only 16 weeks of the spread of the Corona virus. And pushed the American economy towards recession .
The Standard & Poor's 500 Index ended the trading in the positive range this year, but it was still down by 4.5% from the record closing level, while the Dow Jones also fell by 6.7%.
Regarding the stocks to be monitored on Tuesday, we find the shares of a company Brown Forman For alcoholic beverages, whose earnings report is due for the last quarter, and is expected to post earnings of 28 cents per share, with revenues of $ 695 million . It is worth noting that the company manufactures brands of alcoholic beverages such as Jack Daniel's And Finlandia. A company will also be announced Chewy For pet food and pet care products on its earnings report, it is expected to generate profits of 18 cents per share, and revenue of $ 1.5 billion .
Oil prices slipped, but will you continue to decline?
Crude oil prices were subject to intense selling operations during the day Tuesday, to give up their highest level in three months, after the group of major oil producing countries agreed to extend the production cut deal at its record levels until the end of July .
Oil is likely to suffer further losses, she said Goldman Sachs (NYSE: GS). He said , saying that " this recovery was supported by a large background risk and policy stimulates China 's import of crude oil, but the basics is heading to the downside ."
According to analysts at the bank, in light of the demand expectations for a gradual but unconfirmed recovery, the oil market faces major challenges represented in the normalization of one billion barrels of excess stocks . The investment bank expects Brent crude prices to reach $ 35 per barrel in the short term . By the time 6:30 am EST United States of America, futures contracts for crude oil fell by 2.3% to reach level of 37.30 US dollars per barrel, while Brent crude fell 1.8% to a level of 40.06 US dollars per barrel .
Trading begins on shares Vroom After the IPO process
Trading will begin today on the shares of the used car sales company on the Internet Vroom (NASDAQ:VRM) After it underwent an initial public offering at a price of $ 22 per share late Monday from yesterday 's time to go beyond that scope of the previous $ 18 -20 $.
It is worth noting that the company offers about 12.25 million shares, with a market value of approximately $ 2.48 billion . Also a company Vroom It hasn't been profitable since its inception in 2012 , but is looking to take advantage of the shift to a very accelerated online shopping during the spread of the Corona epidemic . Despite this, the auto industry as a whole suffers from serious problems, and consequently a company is forced Vroom To reduce prices and reduce profit margins .
Therefore, investors will be closely watching this deal, given that it is expected that this week will witness the launch of 8 public offerings, to raise about $ 2 billion .
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