US recession fears fade; banks trim head count; critical mineral imports plunge
Sarah Cottle
Growth-Focused Executive | GM | Driving Profitability & Operational Excellence in B2B Data, Research, Advisory | M&A Integration | Governance | Digital Transformation | Trusted C-Suite Advisor | Board Member
In this edition of?Insight Weekly, we examine the outlook for the US economy. Economists at S&P Global Market Intelligence have raised their forecast of real GDP growth for 2023 to 2.2% from 1.8% and said recession fears are ebbing. While a recession may not be on the immediate horizon, the US economy could be set for a downturn in 2024 as the impact of high interest rates fully feeds through to businesses and households. S&P Global's latest Investment Manager Index survey found that 60% of equity investors still expect a recession in the coming year, down from 74% in March and 82% at the end of 2022. Despite some improvement in sentiment, equity investors continue to anticipate losses in the near term.
As part of their efforts to reduce costs, many banks in the US are turning to layoffs amid tough market conditions. In the second quarter, banks working on strategic transformations to improve their performance metrics saw large quarter-over-quarter and year-over-year declines in head count, according to Market Intelligence data. ?
US imports of critical minerals and lithium fell by double-digit percentages year over year in the second quarter amid weak price environments for some materials, according to an analysis by Market Intelligence. Gabon, a key global manganese producer, accounted for 27.2% of US critical mineral imports, followed by China at 13.2%.
?
US Economy in Focus
Recession likely delayed, not canceled, as economy feels effects of higher rates
The US economy is growing and unemployment remains low, yet tight monetary policy conditions are expected to push the country into recession.
—Read more on S&P Global Market Intelligence
?
Risk aversion eases for US equity investors in September as recession fears fade
S&P Global's Risk Appetite Index recorded its best level since February, according to the latest Investment Manager Index survey.
—Read more on S&P Global Market Intelligence
?
Deep Dives
In-depth features looking at the impact of major news developments in key industries.
Financials
US banks trimming head count to keep expenses under control
In the second quarter, the banking industry posted a 0.5% quarter-over-quarter increase in full-time employees, but several banks posted substantial sequential declines to ring-fence expenses and bring performance metrics in line with peers.
—Read more on S&P Global Market Intelligence
?
Wholesale borrowing by banks stabilizes after spring turmoil???
Banks shed Federal Home Loan Bank advances and cash in the second quarter as fears over severe deposit outflows subsided.
—Read more on S&P Global Market Intelligence
Big German banks raise 2023 earnings goals after strong 1st half
Interest rate tailwinds are expected to drive revenues and profits at six of Germany's largest banks in 2023 even amid a weakening economy and inflationary pressures.
—Read more on S&P Global Market Intelligence
China's shadow banking in structural decline as key lender defaults
Core shadow banking assets totaled 17.66 trillion yuan as of end-July, up 1.67% from a year earlier, according to central bank data. Such assets have been declining in recent years.
—Read more on S&P Global Market Intelligence
?
Insurance
US personal lines insurers see combined ratios deteriorate in Q2???????????
An S&P Global Market Intelligence analysis showed a net combined ratio for the industry of 114.9% in the second quarter of 2023 — 2.5 percentage points higher than the previous year period.
—Read more on S&P Global Market Intelligence
Real Estate
8 US REITs, 1 Canadian REIT announce dividend hikes in August
The August numbers bring the year-to-date total to 59 US-based and seven Canadian real estate investment trusts announcing dividend increases.
—Read more on S&P Global Market Intelligence
Private Equity
Global venture capital investment activity slumps YOY in August???????????
The monthly aggregate investment value was $16.92 billion, the lowest August total since at least 2020, according to S&P Global Market Intelligence data.
—Read more on S&P Global Market Intelligence
Energy and Utilities
RRA Research: Multistate hurdles await Dominion's move to pare gas utilities from portfolio
As Canada's Enbridge seeks a foothold in the US gas utility sector, Dominion Energy continues to reshape its asset portfolio via regulated utility sales.
—Read more on S&P Global Market Intelligence
领英推荐
As US Congress regroups, lawmakers seek to avoid shutdown, reach permitting deal
The energy industry also awaits nominees to the Federal Energy Regulatory Commission, which has one open seat and another pending vacancy after 2023.
—Read more on S&P Global Market Intelligence
UK auction failure a double-edged sword for offshore wind, industry says
While the offshore wind auction blank in the UK is bad news for its 50-GW ambition by 2030, analysts said the result demonstrates developers' capital discipline and sends a strong signal to the government about the industry's new economic realities.
—Read more on S&P Global Market Intelligence
Technology, Media and Telecommunications
451 Research: Generative AI use cases could boost document and content management software
Generative AI holds significant promise for software related to content management and services. Meanwhile, document tools are low-hanging fruit for the technology and offer easy entry points for productivity enhancement.
—Read more on S&P Global
?
Metals and Mining
US critical minerals, lithium imports plummet YOY in Q2 2023
US critical minerals and lithium imports notched double-digit percentage declines in the second quarter compared with a year earlier as some materials faced weak price environments.
—Read more on S&P Global Market Intelligence
Metals and Mining Research: Philippines – Mining by the numbers, 2023
While the Philippines remains competitive in terms of nickel reserves and resources and its production, underdeveloped copper and nickel projects provide significant potential for the country to harness amid rising demand for green metals.
—Read more on S&P Global Market Intelligence
Supply Chain
Deforestation rules' impact on supply chains
The European Union Deforestation Regulation introduces wide-ranging supply chain reporting requirements for commodities and their downstream supply chains.
—Read more on S&P Global Market Intelligence
?
The Week in M&A
US bank branch M&A activity muted with only 9 deals so far in 2023
Read more on S&P Global Market Intelligence ?
Cross-border deal is the only $10B-plus M&A transaction announced in August
Read more on S&P Global Market Intelligence ?
Proxy advisers ISS, Glass Lewis call for 'yes' vote on Oneok-Magellan merger
Read more on S&P Global Market Intelligence ?
After major gas utility deal, Dominion may not be done selling assets
Read more on S&P Global Market Intelligence ?
?
The Big Number
?
Trending
—Read more on spglobal.com and follow @SPGlobalPMI on X, formerly known as Twitter.
Discover S&P Capital IQ Pro
Uncover opportunities and address market challenges head-on with the data, tools and insights of S&P Capital IQ Pro, our integrated Essential Intelligence?? platform.
Additional Insights from S&P Global Market Intelligence
Increase your competitive edge with essential insights delivered straight to your inbox. We offer complimentary newsletters on a wide variety of topics to help you stay on top of what’s moving the markets, separating the immaterial from the invaluable. Review our newsletters and sign up here.
Compiled by Waqas Azeem