Evergande Default, World and Pandemic, Italy and Amazon
In yesterday, even with a magnifying glass of heightened optimism, it was difficult to find positive. The epic with Evergande seems to be going according to the worst scenario for China. China Evergrande Group was officially recognized as a defaulter for the first time. Fitch Ratings downgraded Evergrande to "limited default" due to the company's inability to make two coupon payments by the end of the grace period on Monday.
A similar story goes for another Chinese developer, Kaisa Group Holdings Ltd., which failed to redeem its $ 400 million bonds maturing on Tuesday.
If we sum up the bond issues by both companies, we will get an amount of over $ 30 billion. But this may be just the beginning of a long journey, the movement along which will not end with anything good for the Chinese economy. And the world as a whole can suffer badly due to financial contamination.
But the negative of yesterday was not limited to this. Italy's antitrust authority said Thursday it had fined Amazon € 1.13 billion for alleged abuse of market dominance. This is one of the most severe fines imposed on the American tech giant in Europe.
Well, pandemic news became the cherry on top of this cake. The UK has decided to remind markets that with a new strain breaking through standard vaccination defenses, the only way to deal with it is with lockdowns and restrictions. So yesterday, Prime Minister Boris Johnson announced tougher government measures to prevent the accelerating spread of Covid-19 in the UK. While we are talking about the recommendation to work from home.
In general, according to the Global Health Security Index (GHS), no country in the world is ready for the next pandemic, and most are insufficiently prepared for even small outbreaks of disease.
In general, with such a fundamental background, the markets meet the end of the week. Today's data on consumer inflation in the US may well tip the scales to the side of the pessimists, and we will see another change in sentiment in the financial markets.
A similar story goes for another Chinese developer, Kaisa Group Holdings Ltd., which failed to redeem its $ 400 million bonds maturing on Tuesday.
If we sum up the bond issues by both companies, we will get an amount of over $ 30 billion. But this may be just the beginning of a long journey, the movement along which will not end with anything good for the Chinese economy. And the world as a whole can suffer badly due to financial contamination.
But the negative of yesterday was not limited to this. Italy's antitrust authority said Thursday it had fined Amazon € 1.13 billion for alleged abuse of market dominance. This is one of the most severe fines imposed on the American tech giant in Europe.
Well, pandemic news became the cherry on top of this cake. The UK has decided to remind markets that with a new strain breaking through standard vaccination defenses, the only way to deal with it is with lockdowns and restrictions. So yesterday, Prime Minister Boris Johnson announced tougher government measures to prevent the accelerating spread of Covid-19 in the UK. While we are talking about the recommendation to work from home.
In general, according to the Global Health Security Index (GHS), no country in the world is ready for the next pandemic, and most are insufficiently prepared for even small outbreaks of disease.
In general, with such a fundamental background, the markets meet the end of the week. Today's data on consumer inflation in the US may well tip the scales to the side of the pessimists, and we will see another change in sentiment in the financial markets.
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