Covid Fear Costs US Economy US$250 Billion | 26 October 2022 | Daily Morning Note

The Daily Morning Note is a round-up of local and global business headlines that you need to know to get ahead of your day.

New research shows that American economic output decreased by US$250 billion during the first half of 2022 because of fears of infection by Covid. More than 60% of survey respondents said they would never return to pre-Covid activities, including riding crowded subways and elevators.

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Key takeaways


Local shares ended Tuesday on a fairly upbeat note, as investors shrugged off slightly dour macroeconomic news of Singapore’s core inflation rising further to 5.3 per cent in September. The benchmark Straits Times Index rose 0.5 per cent or 14.2 points to end Tuesday at 2,984.15. Elsewhere in the region, markets ended the day mixed.

Wall Street stocks rallied and the dollar slid on Tuesday on hopes for a moderation in Federal Reserve policy, while the pound shot higher as former finance chief Rishi Sunak became Britain’s prime minister. US stocks rallied for a third straight day, propelled by a drop in US Treasuryyields following disappointing consumer confidence data as concerns about costs of living intensified.

Singapore News

Singapore’s core inflation rose further to 5.3 per cent in September but headline inflation held steady at 7.5 per cent, according to Department of Statistics consumer price index data on Tuesday. Bothreadings were in line with economists’ expectations. The pickup in core inflation was due to larger price increases for items such as food, services and retail and other goods.

Singapore Airlines will be redeeming for S$3.86 billion all of its 10-year mandatory convertible bonds issued in June 2020 at a redemption rate of 110.408 per cent of the principal amount. In a notice filed on the Singapore Exchange on Tuesday, SIA said that payout will be made to bondholders on Dec 8, 2022.

The manager of Mapletree Logistics Trust on Tuesday announced a 3.5 per cent increase in distribution per unit to S$0.02248 for the second quarter ended September, from S$0.02173 in the corresponding period a year ago, despite an enlarged unit base. The amount distributable to unitholders rose 15.6 per cent to S$108 million, driven by higher revenue from existing properties and contributions from accretive acquisitions completed in Q1 FY22/23 and in FY21/22.

US News

Google parent Alphabet reported revenue and earnings that fell short of analysts’ expectations, showing the company’s search advertising juggernaut was not immune to a slowdown in the digital ad market. The shares fell more than 6 per cent. Alphabet said third-quarter sales, excluding payments to distribution partners, were US$57.27 billion.

Coca-Cola said third-quarter sales and profit surpassed expectations and the beverage giant raised its guidance for the year, as the company got a boost from value-conscious products amid soaring inflation. The Atlanta-based soft-drink maker said on Tuesday that it benefited from bundling different sizes and mixes of its products for inflation-wary consumers. The company said it now sees organic revenue growth of 14 per cent to 15 per cent for the full year.

Microsoft posted its weakest quarterly revenue growth in five years, throttled by the surging US dollar and a slump in sales of Windows software to personal computer makers. Shares slipped in late trading. Sales in the first quarter, which ended Sep 30, rose 11 per cent to US$50.1 billion, the software maker said on Tuesday in a statement. Net income was US$17.6 billion, or US$2.35 a share.

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