Surging Covid-19 cases dampen US consumer confidence, house prices post record gains
WASHINGTON (REUTERS) - US consumer confidence fell to a six-month low in August as worries about soaring Covid-19 infections and higher inflation dimmed the outlook for the economy. The survey from the Conference Board on Tuesday (Aug 31) showed consumers less inclined to buy a home and big-ticket items like motor vehicles and major household appliances over the next six months, supporting the view that consumer spending will cool in the third quarter after two straight quarters of robust growth. Still, more consumers planned to go on vacation, indicating a rotation in spending from goods to services was underway as economic activity continues to normalize following the upheaval caused by the coronavirus pandemic. Increased spending on services, which account for the bulk of economic activity, should keep a floor under consumer spending. "The report does raise the warning flag that if the pandemic worsens, and given the continued unwillingness of many to get vaccinated that is a real possibility, we could see people stashing away funds just in case," said Joel Naroff, chief economist at Naroff Economics. "We could see growth moderate faster than expected." The Conference Board's co...
ExxonMobil scales back shale ambitions to focus on lower costs, dividend preservation
HOUSTON (REUTERS) - ExxonMobil is lowering its ambitions for oil and gas output, it said on Wednesday (March 3), as it focuses on cutting costs and preserving dividends to win back investors that have soured on the company after years of overspending. The top US oil producer, which on Tuesday announced it will cut 300 jobs of 7 per cent of its workforce in Singapore, incurred a historic loss of US$22.4 billion (S$29.86 billion) last year. ExxonMobil is trying to convince a skeptical Wall Street that it can rebound after years of overspending left it deeply indebted and lagging behind rivals better geared for a world demanding cleaner fuels. ExxonMobil last year fell out of the Dow Jones index of top US companies and shares fell to a two-decade low. Activist investors are pushing it to lessen its reliance on fossil fuels. "The priority right now is to rebuild the balance sheet," ExxonMobil chief executive Darren Woods said on a media call following a virtual analysts day that emphasized the company's commitment to lower spending and reducing debt, which has ballooned to US$67.6 billion from US$37.8 billion two years earlier. That said, some analysts criticized ExxonMobil's spending ...
Virus-hit US economy suffers worst showing in 74 years
WASHINGTON • The United States economy contracted at its deepest pace since World War II in 2020 as the Covid-19 pandemic depressed consumer spending and business investment, pushing millions of Americans out of work and into poverty. Though a recovery is under way, momentum slowed significantly as the year wound down amid a resurgence in coronavirus infections and exhaustion of nearly US$3 trillion (S$4 trillion) in relief money from the government. The moderation is likely to persist at least through the first three months of this year. The economy's prospects hinge on the distribution of vaccines to fight the virus. President Joe Biden has unveiled a recovery plan worth US$1.9 trillion, but some lawmakers have baulked at the price tag as the initiative comes soon after the government provided nearly US$900 billion in additional stimulus late last month. White House economic adviser Brian Deese said the report from the Commerce Department on Thursday underscored the urgency for Congress to pass Mr Biden's plan, warning that the cost of doing nothing was too high. "Without swift action, we risk a continued economic crisis that will make it harder for Americans to return to work an...
Wall Street tops new highs on Democrat-driven stimulus hopes
NEW YORK (REUTERS) - Stocks on Wall Street hit record levels on Thursday (Jan 7) as investors bet a Democrat-controlled Congress will deliver more stimulus spending to help the US economy overcome a steep pandemic-induced downturn. The Dow, S&P 500 and Nasdaq all set new highs amid growing calls for President Donald Trump's removal, one day after Trump supporters stormed the US Capitol in a harrowing assault on American democracy. US House Speaker Nancy Pelosi urged Trump's immediate removal from office through the 25th Amendment. President-elect Joe Biden accused Trump of fomenting violence and said Wednesday was one of the darkest days in US history. "The market is now looking past Trump and it's looking forward to a Biden presidency, more structure and stimulus," said Dennis Dick, a trader at Bright Trading LLC. "A Democratic Congress is going to obviously be more concerned about the small businesses, and the Main Street." Economy-linked financials jumped while industrial and materials sectors hit new records on expectations Biden will line up a bigger fiscal package and boost infrastructure spending with Congress under Democrat control. Rate-sensitive bank shares gained, tracki...