Daily Archive: May 11, 2020

Investing

May 11, 2020

Digital-friendly recession: How Big Tech got even bigger in the midst of a market meltdown

Big Tech has powered the ferocious stock market rebound from the coronavirus sell-off, defying expectations that an economic downturn would bring an end to investors’ love affair with fast-growing but expensively priced stocks.

The so-called FANG stocks — originally Facebook, Amazon, Netflix and Google, but with Microsoft and Apple also often thrown in to the mix — became emblematic of the U.S. technology-driven rally after the global financial crisis of 2008.

They helped drag the S&P 500 up by nearly 400 per cent from its 2009 low to the beginning of 2020, leaving many other equity markets in Europe and Asia in the shade. The more tech-oriented Nasdaq 100 index climbed more than 700 per cent over the same period.

This stretched valuations. A key measure of that — the ratio between the Nasdaq 100 companies’ share prices and expected earnings — rose to more than 25 at the start

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News

May 11, 2020

South Korea’s May 1-10 exports dive as coronavirus wipes out global demand By Reuters

© Reuters. FILE PHOTO: A container terminal is seen at Incheon port in Incheon

SEOUL (Reuters) – South Korean exports and imports suffered a precipitous decline in the first 10 days of May, underlining a bleak outlook for Asia’s fourth largest economy and international trade as the coronavirus crisis slammed global demand.

Exports contracted 46.3% year-on-year in the period, while imports fell an equally dizzying 37.2%, data from the Korea Customs Service showed on Monday.

By categories, overseas sales of semiconductors dropped 17.8%, while that for mobile communication devices and petrochemical products contracted sharply by 35.9% and 75.6%, respectively.

The numbers from South Korea, the first major exporting nation to release monthly trade data, underscores the pandemic’s devastating impact across supply chains and businesses, and points to a rough yeah ahead for international trade.

The export-reliant economy stumbled into its biggest contraction since 2008 in the first quarter even as

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Finance

May 11, 2020

Why it’s suddenly harder to get a mortgage than it’s been in years

Mortgage rates are at record lows, but borrowers hoping to take advantage are running into the toughest loan-approval standards in years.

Over the past month, lenders have put in place higher credit-score and down payment requirements, and in some cases stopped issuing certain types of loans altogether, in effect shutting down a large swath of the mortgage market.

The triggers, industry executives say, include lenders becoming risk-averse during the coronavirus crisis, knock-on effects of Congress allowing millions of borrowers to delay their monthly payments, and policies implemented amid the pandemic by mortgage giants Fannie Mae and Freddie Mac. The impact has been dramatic, with one model showing mortgage credit availability has plunged by more than 25% since the U.S. outbreak of the virus.

The tightened lending could add another headwind for the nation’s besieged economy by dampening home sales just as some states lift stay-at-home orders and the spring … Read More

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