In Germany, Angela Merkel has announced a 130 billion euro stimulus package to combat the crisis caused by the pandemic. After the second day of negotiations, the German coalition government has managed to agree on an aid programme to be implemented between this year and next, which will be added to the one launched in March, valued at 156 billion euros, exceeding the initial estimates of 50-100 billion.
Feel Capital | Until September, the government will have pay out over €39.4 billion euros in benefits to the more than 9.8 million pensioners in Spain, as well as to people claiming widowhood, permanent disability, orphanhood and family favour benefits. As a result, it will be forced to take extraordinary measures this summer after the emptying of the pensions’ piggy bank.
via The Conversation | One important pillar of Hong Kong’s economy remains unchanged and outside of Chinese government control – its currency, which is pegged to the US dollar via a currency board. This could have significant benefits for the city as it tries to deal with pressing socioeconomic challenges. But this also requires more public spending from the special administrative region’s government.
Nitesh Shah (Wisdoom Tree) | OPEC+ had been readying itself for an earlier-than-originally scheduled meeting. That drove oil prices higher. However, disputes about compliance levels with quotas are casting doubt on moving the meeting to 4th June. If the meeting does go ahead this week, oil prices are likely to recoup intra-day losses on 3rd June. That could take Brent above US$40/bbl and WTI above US$38/bbl.
The EY Global IPO Trends report for the first quarter of 2020 noted how global IPO activity dropped dramatically in March, due to the pandemic. So the report considers IPO activity would not improve “at the earliest” until the second half of 2020. And it seems to have hit the mark, with the Dutch company Jacobs Douwe Egberts (JDE), the world’s second largest coffee producer started trading last week. It is the first major IPO of 2020, raising a total of €2.25 billion.
Banca March | At the end of the first quarter, BBVA strengthened its leadership in the ranking by assets in Spain. For the first time in its history, BBVA broke the €400 billion barrier in assets, which is more than Bankia and Sabadell combined.
Bankinter | The European Commission (EC) has given Banca Monte Dei Paschi Di Siena (MPS) the go-ahead to finally set up a toxic asset restructuring entity. The plan has yet to be approved by the ECB and the Italian watchdog (Consob) but there is a high probability of success. The most important thing is that the EC does not consider the operation as a form of state aid. The finalisation of the process is planned for end-2020 or the beginning of 2021.
Simon Peters (eToro) | Bitcoin has passed the much-feted $10,000 resistance level, the first time since the crash of February 2020 when it dipped to $3,850 due to Covid-19 fears.
Intermoney | Argentina has once again been subject to a credit episode, as ruled yesterday by the International Swaps and Derivatives Association (ISDA), which involved the activation of the well-known CDS insurance. Argentina has accumulated 8 default episodes, four of which have occurred since 1980. Whatsmore, it could be considered that one more may have been added to these figures – namely the defaults of the southern country which would bring the total to 9.
The number of unemployed in Spain increased by 26,573 people in May, compared to 282,900 the previous month and -84,075 in May 2019. This is the worst May figure in recent years, but it is a vast improvement on previous months (up 282,000 in April and up 302,265 in March).This may be enough to raise some optimism in the Spanish labour market. The labour market data for May also reflects an increase of 97,462 people registered with Social Security compared to the previous month.