Last week in the US and Europe began the season of quarterly corporate reporting, which this time analysts are watching especially closely. The company report for the second quarter — it is in many countries, the peak limiting and quarantine for pandemic COVID-19. Judging by the first reports of large Western businesses have generally managed to avoid catastrophic consequences from the pandemic, and the reporting season was one of the most contrast for the last time. Some companies reported a sharp drop in profit, hoping for a rebound in the near future. Others managed to use the difficult market conditions and to achieve record levels.Bank Bank rosnedrami of the first last week, the season of corporate reporting for the second quarter, which was the peak of quarantine measures, opened the largest U.S. banks. It was the centre of attention. The slowdown in economic activity and rising unemployment, generally cause a rise in defaults on loans, which in turn can lead to large losses for banks. In 2007-2008, large-scale losses that the American financial Corporation suffered because of rising defaults on mortgages led to the financial crisis in the United States, and then throughout the world. Reporting Tuesday from three of the leading US Bank JP Morgan, Citigroup and Wells Fargo — have pledged a total of $28 billion to cover future losses on loans. Moreover, JP Morgan profit fell by half, and Wells Fargo and is reported the first since the great depression quarterly loss. Two days later, this trend was supported by another American Bank of the “big six” — Bank of America, which reported a net profit drop of 52%. The company is still in the first quarter was preparing for a wave of credit defaults, evaluating possible losses on loans of $4.76 billion In the second quarter, the Bank raised its forecast for credit losses to $5.12 billion. “Now the big question for investors is whether the second quarter the low point for banks,”— said in a live CNBC Barclays analyst Jason Goldberg.However, other us banks have demonstrated extremely high level. For example, Morgan Stanley has surpassed all forecasts of analysts. Its revenues from trading in financial instruments with fixed income (bonds, etc.) jumped 170%, revenue from equity trading increased by 23%, while revenues investment banking division as a whole grew by 39%. As a result, the Dow Jones index on Tuesday gained almost 600 points, or 2.1%, showing the best dynamics for the last two weeks, while the S&P 500 index added 1.3 percent. Some media have already called this the reaction of investors and stock market roller coaster.Bank Goldman Sachs showed one of his best quarters of the proceeds from the trade��govich operations — the increase was 93%; revenue from trading bonds soared to 150% and from trading stock by 46%. Overall, investment banking at Goldman Sachs operations showed revenue growth of 36%. The variation in the indicators in the same industry due to the fact that in the second quarter of operations for retail banking and lending, felt the impact from rising defaults on loans and trading securities, by contrast, are extremely profitable due to record speed operations. According Refinitiv, debt offerings grew by 52% compared to the first, reaching $3.3 trillion. It was an absolute record. The necessity of raising funds in terms of quarantine had forced the company to resort to the offering of its shares. Activity in equity capital markets in the first half of this year became record over the last five years. The volume of funds raised worldwide was $447 billion, which is 41% higher than a year earlier. Number of offerings — 2444 — first half of 2020, 12 per cent higher than in the first half of 2019 and became record for last two years. Photo: ReutersRefinitiv also noted a significant increase in activity in the market of hybrid capital — mainly bonds convertible into shares. In the first half of companies attracted to this market, $94 billion, 41% more than last year and a record since 2007. Portfolio Manager of investment company Gabelli Global Financial Services Fund Ian Lapi Forbes said that in such circumstances “banks, whose business is a large share of investment and trading transactions as opposed to traditional lending, feel much better.”It is very good that we Plokhov other sectors the second quarter also sharply divided the winners and losers. One of the hardest hit sectors since the spring was the air transportation market, where companies are forced to stand because of the mass bans on flights in the conditions of the quarantine. About mass layoffs of employees or sending them on unpaid leave previously warned airlines such as Lufthansa, Virgin, EasyJet, American Airlines, United Airlines, Ryanair, etc. last Tuesday, American airlines Delta Air announced the earnings drop by 88% to $1.4 billion, a net loss of — $5.7 billion (whereas a year earlier the company received a profit of $1.4 billion) and the growth of the debt to $13.9 billion Photo: ReutersБольшой damage from quarantine and slowing economic activity suffered and industrial companies. Last Thursday, the Swedish industrial Group Volvo, produces trucks, buses, heavy construction equipment and related equipment, reported (.pdf) that its revenue fell 39% from $13.3 billion in the second quarter of 2019 to $8 billion today. The net profit of the Volvo Group has decreased to virtually zero to $4.8 million, while a year RA��her company received a quarterly profit of $1.3 billion, But despite these reports, quotes Delta Air Volvo Group and for the week gained 7% and 1.5% respectively. Investment analyst Adam Levine-Weinberg explains this by a number of factors, which may indicate the imminent recovery of the indicators. Delta Air began to spend much less available funds to maintain its operations during idle time — about $27 million a day. In April, it is expected that this figure will be $50 million a day. Cost peak was in March — $100 million a day. The analyst draws attention to the fact that the company remains a solid inventory of available funds, at the end of the second quarter, they totaled $15.7 billion And even if the company will continue to spend these funds at the current level until the end of 2020, it remains about $10 billion In turn, the optimism of investors in relation to the Volvo Group was the phrase of the company of a gradual recovery in demand. The head of the Swedish company Martin Lundstedt said that “as the opening of countries (after the quarantine.— “Kommersant”), we recorded a gradual recovery of indicators such as new orders and capacity utilization of the fleet.”The figure rose Zenev in contrast to the aviation industry and the industry of the company’s high-tech sector during the quarantine felt a noticeable increase in the demand for their services. This also applies to Internet trade, and consumption of content and use various programs and applications. According to the research company App Annie, the average for each month of the second quarter, users from around the world spent on various applications a record 200 billion hours. In early June, Apple and Microsoft were the first companies whose capitalization exceeds $1.5 trillion. The growth of Microsoft stock last but not least associated with the development of it cloud services that are relevant during a pandemic due to the spread of telecommuting. In Apple’s case, the enthusiasm of investors has caused the anticipation on iPhone with support for 5G, and the success of wearable devices and services company. Photo: Anushree Fadnavis/File Photo, ReutersВ early July, the market capitalization of $1.5 trillion achieved and online retailer Amazon. However, this increase in popularity in the quarantine period may lead to the opposite effect in the near future. An example of such possible developments was published on Thursday quarterly reports videoscreensaver of the Netflix service. Despite the fact that revenue grew 25% and net profit — in 2,5 times, after publication of reports Netflix shares fell sharply by 8%. The fact that the company gave a forecast for the growth of new users in the next quarter, much weaker than analysts had expected. Netflix is waiting for increase of 23.4%, or 2.5 million subscribers, also interviewed Refinitiv analysts had expected a 5.3 million Experts believe that the situation can be indicative of Netflix and other Internet companies, whose popularity rose sharply during the quarantine. High-tech market analyst gene Munster of the TV channel CNBC drew attention to the increasing risks for them in the second half of the year. “The real recovery of the market in many respects depends on what will be in the “December quarter” (of the fourth quarter.— “Kommersant”),— the analyst believes.— As the company will publish forecasts and targets for its activities for the coming months, this becomes the most important issue.”Eugene Tail
