Today's big stories

Morgan Stanley doubled down on its prediction of a “V-shaped” recovery
Our analysts reckon it might be curtains for cinema stocks – Read Now
Oil giant BP will slash the value of its assets by $17.5 billion, and it's lowered its oil price forecast too

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Comeback Kids

What’s Going On Here?

The global economy is looking all but defeated right now, but Morgan Stanley just doubled down on its bet that we’re set for an inspirational comeback. Cue the music…

What Does This Mean?

Among the Alphabetti Spaghetti of economic recoveries out there, the V shape is one where the economy bounces back as quickly as it collapsed. And that’s what Morgan Stanley is betting on: the bank thinks there’ll be a “sharp but short” global recession, and that the global economy will be growing again by early 2021 (tweet this).

Morgan Stanley reckons companies and consumers aren’t under as much pressure to reduce their debts as in previous downturns, largely thanks to the unprecedented support from central banks and governments. Massive efforts to cut down debt, after all, usually spell bad news for spending and, in turn, economic growth. The bank also believes said support isn’t likely to wane anytime soon, which should help the global economy get back on its feet before too long.

Why Should I Care?

For markets: Come at me, bro.
Morgan Stanley thinks a second wave of coronavirus infections will sweep the globe by the fall, but that it’ll cause smaller-scale lockdowns and less disruption this time around. The bank also admitted that if a second wave does lead to strict, widespread lockdowns, a “double-dip recession” could be on the cards. Investors seem to be in the latter camp: they largely avoided stocks on Monday, perhaps having noticed the recent rise in US and Chinese coronavirus cases.

The bigger picture: After you, China.
Given that China was the first country in and out of the coronavirus crisis, investors have been looking to the People’s Republic for clues about how the rest of the global economy will perform. The country’s heavy industries, like construction, are reportedly back to 2019 levels, but overall demand is still weak – potentially because the rest of the world is still reeling.

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2/3 Premium

Roll Credits

What’s Going On Here?

As a $2 billion deal to create North America’s largest movie theater chain gets left on the cutting room floor, at least one downtrodden cinema stock looks ready for its close-up.

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3/3

Boo!

What’s Going On Here?

BP might look big and tough, but it’s just as frightened as the rest of us: the British oil company admitted on Monday it could face asset “write-downs” worth $17.5 billion this quarter.

What Does This Mean?

Accountants regularly assess what a company’s assets are worth, and if they and the company’s bosses decide one of those assets isn’t actually as valuable as they thought, they’ll write down its value – effectively lowering what it’s worth on paper.

BP’s upcoming write-down coincides with the company’s lowering of its oil and gas price forecasts: the giant now thinks the average price of a barrel of oil will be $55 from next year through to 2050 – more than 25% below its previous prediction. And if BP thinks oil’s worth less, the oil major’s oil fields must be too, leading to the write-down it’ll announce in its second-quarter update.

Why Should I Care?

For markets: The waiting game.
Things have gone from bad to worse for BP and its investors: the company revealed a 70% drop in its first-quarter profit in April, and announced 10,000 job cuts last week. And while we’ll have to wait till August to see just how much damage this write-down has done to BP’s accounts, some investors weren’t keen to wait around: they sold off the oil major’s stock on Monday, and it fell 3%.

The bigger picture: Green is the new black.
One reason BP has lowered its oil price forecast is that it believes the coronavirus pandemic will actually accelerate the world’s transition to a lower-carbon economy. And BP wants to play its part, with an aim of net-zero carbon emissions by 2050. A Goldman Sachs report last year argued big oil companies would be at the center of the climate revolution – and with Shell, Repsol, and Total all on the front foot when it comes to environmental concerns, it might well be right.

Take action: How to invest in protecting the planet.

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💬 Quote of the day

“The only thing worse than being blind is having sight and no vision.”

– Helen Keller (an American author, political activist, and lecturer)

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🤔 Q&A · RE: Lost Cause

“Why can’t retail investors easily participate in share sales?”

– Michelle

“The precise rules vary depending on where in the world you are, Michelle, but by and large, it’s both a matter of keeping retail investors safe and making life easier for the company selling shares. Simply put, there’s much more paperwork involved when a company sells shares to non-professional investors, which brings added costs and a more complex, long-winded process. And since time has been of the essence for companies raising money during this pandemic, retail investors generally haven’t been afforded the opportunity to buy into new share sales until at least the day after they’re sold.”

🙋 Ask a question

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No catch, either: InvestEngine’s management fees are just 0.25% a year, with some additional costs for ETFs. Sounds to us like it could be a great way of bolstering your income, so give InvestEngine a try today.

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🌍 Finimize Community

🤖 The future is now-ish

The year is 3020, and we’re chatting about how cryptocurrencies and blockchain technology are weaving their way into our day-to-day with Bitcoin Montreal Meetup’s co-organizer Maciej Cepnik. Sorry, that should be 2020. This Wednesday, in fact. Who’s editing this thing?

🇫🇷 France: The Future of Blockchain & Cryptocurrency – 6.30pm CET, June 17th
🇭🇺 Hungary: What’s Next For The Energy Market? – 6.00pm CET, June 23rd
🌍 Global: Finimize Live AMA – 1.30pm UK Time, June 30th

📚 What we're reading

The women reshaping African publishing (Lit Hub)
You missed a spot (Popular Mechanics)
Climate and racial injustice are closely linked (MIT Technology Review)

Finimize - 😎 Morgan Stanley: ignore the recession

Today's big stories

Comeback Kids

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Roll Credits

💧 Revitalize your income

Boo!

What’s Going On Here?

What Does This Mean?

Why Should I Care?

💸 Get paid monthly by your investments

🤖 The future is now-ish

Older messages

😭 Uber goes hungry

💪 Activism really works

📈 Tech stocks break records

💉 The 240 billion coronavirus cure

🇺🇸 Best jobs report ever

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