Daily update: July 19, 2021

Start each business day with our analyzes of the most pressing developments affecting the markets today, as well as a curated selection of our most recent and important information on the global economy.

The global recovery in the media and telecommunications sectors is accelerating, as evidenced by the corporate enthusiasm for more content, which is fueling consolidation.

In June, 121 media and telecommunications mergers and acquisitions (M&A) were announced worldwide, up from 79 in the same month last year, according to S&P Global Market Intelligence. In the previous month, 104 media and telecommunications deals were announced, up from 68 in May 2020, according to another analysis by S&P Global Market Intelligence. This follows a wave of major M&A deals in the second quarter – Amazon’s decision to buy MGM Studios for $ 8.45 billion and AT & T’s plans to merge its Discovery and Warner Media assets into a single conglomerate for $ 43 billion in cash – which has driven up and consolidating advisor fees at how fast technology and media are transforming.

Special Purpose Acquisition Company (SPAC) transactions play a central role in the entertainment industry revolution. Universal Music Group’s deal with SPAC Pershing Square Tontine Holdings, which is valued at $ 3.95 billion and involves a total enterprise value of around $ 40 billion for Universal Music, marks Universal’s passage Music in public markets, according to S&P Global Market Intelligence. Additionally, former DVD rental kiosk company Redbox Automate Retail goes public through a reverse merger with SPAC Seaport Global Acquisition Corp. with the aim of evolving its business model for the digital age.

Content consolidation is creating more and more cable and streaming giants. Spanish-language media company Grupo Televisa’s announced decision to merge content units with Univision television network for $ 4.8 billion is expected to make the combined operation the largest producer of Spanish-language content in the world . Ready to launch a two-tier aggregated service next year, Univision is already stepping up its streaming offering and ambitions.

Market participants do not expect regulatory risk to interfere with the speed or success of such transactions. Analysts told S&P Global Market Intelligence that the UK government’s program to equalize broadcasters and video-on-demand services is unlikely to slow the growth of US streaming service providers in the country. In the United States, other analysts expect the Discovery-WarnerMedia deal to survive regulatory scrutiny.

Today it’s Monday July 19, 2021, and here is today’s essential intelligence.

Uncertainty in the global economy

Low-income black Americans hit hardest by pandemic medical debt – Survey

Black, Hispanic and low-income Americans have been disproportionately affected by problems with medical bills and debt during the pandemic, according to an investigation by the Commonwealth Fund, a private, non-partisan foundation.

—Read the full report of S&P Global Market Intelligence

The credit cycle

Listen: The Upgrade Episode 13: Rising Stars, Fallen Angels

In this episode of The Upgrade podcast, S&P Global Ratings discusses what’s new in Rising Stars and Fallen Angels based on recent research, along with a detailed discussion of a recent rising star: Advanced Micro Devices.

—Listen and subscribe to CLOs Uncovered / The Upgrade, a podcast of S&P Global Ratings

Default, Transition and Recovery: Four Defects Bring Global Business Total from 2021 to 52

The number of corporate defaults in 2021 rose to 52 after four issuers defaulted last week. The defaulters are: Virginia-based travel document provider KCIBT Holdings LP Spain-based audio-video service provider Joye Media SLU coal producer Peabody Energy Corp. (This issuer also defaulted on February 3 and June 3, 2021.) China Real estate developer Sichuan Languang Development Co. Ltd.

—Read the full report of S&P Global Ratings

Take the estimation of losses given default to the next level: an aspiration for all creditors, not just banks

Credit is the basis of national and international trade. Lending varies in sophistication, from ultra-complex (eg, asset-backed securitization) to very simple (eg, unregulated credit unions). Regardless of type, size, sophistication, and geography, there is only one thing that creditors can be sure of: there is no such thing as absolutely risk-free, and therefore not all debtors will repay. in full and on time.

—Read the full report of S&P Global Market Intelligence

Market dynamics

Amplified by tariffs, high US steel prices could conflict with infrastructure plans

Steel prices in the United States are skyrocketing, at least in part because of declining domestic production and tariffs on steel imports enacted under former President Donald Trump. The trend could stifle any effort to stimulate large-scale infrastructure.

—Read the full report of S&P Global Market Intelligence

ESG in the time of COVID-19

Factbox: China launches national carbon market in the electricity sector

China’s highly anticipated national carbon market was launched on July 16 and is expected to become the world’s largest in terms of the volume of carbon allowances traded. The launch of the Chinese carbon market is a first step towards decarbonizing the country’s industrial sectors, even as the government strikes a precarious balance between sustaining economic growth and pricing carbon.

—Read the full report of S&P Global Platts

Foreign investors flock to the booming Spanish renewable energy market

Spain has become the city’s most popular ticket for international investors in renewable energy, government green policies and a favorable electricity market helping to generate interest abroad.

—Read the full report of S&P Global Market Intelligence

FERC Launches Major Rule-Making Effort to Accelerate Electricity Grid Construction

On July 15, the Federal Energy Regulatory Commission took the first step in developing a proposal for a major electric transport planning rule that could eventually transform the country’s energy landscape. In an Advance Notice of Proposed Rulemaking, or ANOPR (RM21-17), the commission sought comments on how it should overcome the obstacles that have hindered the construction of electric transmission at the pace and scale necessary to avoid the worst effects of climate change.

—Read the full report of S&P Global Market Intelligence

Argentinian oil producers focus on carbon neutralization as they ramp up production

Argentina’s largest oil producers take action to reduce or neutralize carbon emissions as they seek to ramp up production from the Vaca Muerta shale field ahead of demand drop, as natural gas gains in transition towards zero carbon energy, the leaders said.

—Read the full report of S&P Global Platts

More than 21,000 people without electricity in Belgium after the bursting of the banks of the Meuse

More than 21,000 people in the Walloon region of southern Belgium remained without power after devastating floods that flooded the Meuse, local distributor Ores said on July 16. The worst flooding in Belgium seems to be over, but the Pepinster high-voltage substation in the province of Liège was badly damaged and remains inaccessible, system operator Elia told S&P Global Platts.

—Read the full report of S&P Global Platts

Western US faces rising risk of gas burns in hot, dry August forecast

The western United States could see more record-breaking gas-fired electricity use this summer, with warm temperatures and dry conditions likely to continue in the region into August, according to an outlook update for the coming month. from the National Weather Service.

—Read the full report of S&P Global Platts

The future of energy and raw materials

Chinese independent refiners cut crude prices as high oil prices squeeze margins

Chinese independent refiners set to cut execution rates as rising oil prices continue to threaten domestic refining and selling margins of fuel producers, paving the way for a sharp drop in crude imports industry in September, market and industry sources said.

—Read the full report of S&P Global Platts

Greenland ends decades of oil hunt by banning new licenses

Greenland has decided to stop issuing new oil and gas exploration licenses, ending decades of searching for resources in its remote Arctic waters. Natural Resources Minister Naaja Nathanielsen said that despite potential large oil reserves off the west coast of Greenland, she now considered the price of oil extraction “too high”.

—Read the full report of S&P Global Platts

Written and compiled by Molly Mintz.

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