US brief

Pfizer on Thursday (Jul 28) reported a 78 per cent jump in profit and reaffirmed the combined 2022 sales forecast of US$54 billion for its Covid-19 vaccine and pill, as countries rushed to sign contracts to prepare for a surge of cases in the fall season. Shares rose 1.8 per cent in premarket trading as overall net income rose to US$9.91 billion despite a stronger US dollar, thanks to strong demand for the vaccine as well as its antiviral treatment Paxlovid. Demand for the pill, which was used by President Joe Biden during his bout of Covid-19 infection, has picked up recently in the United States and other countries due to fresh outbreaks.

The US dollar rebounded across the board on Thursday (Jul 28) as investors digested the implications of the Federal Reserve's (Fed) latest comments on the future path of interest rates while the euro slumped broadly as the region's economic outlook darkened. Traders interpreted the Fed's decision to drop its commitment to guide markets on the future rate trajectory after a widely expected 75 bps hike as a sign that policymakers may soften their stance, pushing the US dollar lower. But the greenback rebounded broadly in midday London trading as traders cut some of those bets on worries that other economies, notably Europe and China, will continue to struggle in the short term, benefiting US dollar-based assets.

Billionaire Jack Ma plans to relinquish control of Ant Group, Dow Jones reported, citing people familiar with the matter said, part of the fintech giant's effort to appease regulators following a lengthy crackdown. With Ma giving up control, a revival of Ant's initial public offering (IPO) could be put back another year or more, Dow Jones reported, citing Chinese securities regulations that require a timeout on public listings for companies that have gone through a change in control. Ma, who doesn't hold any titles at Ant, currently controls 50.52 per cent of voting rights in the company. He could transfer some of his voting power to other Ant officials including chief executive Eric Jing, Dow Jones cited the people as saying.

The drumbeat of recession grew louder after the US economy shrank for a second straight quarter, as decades-high inflation undercut consumer spending and Federal Reserve interest rate hikes stymied businesses and housing. Gross domestic product (GDP) fell at a 0.9 per cent annualised rate after a 1.6 per cent decline in the first 3 months of the year, the Commerce Department’s preliminary estimate showed on Thursday (Jul 28). Personal consumption, the biggest part of the economy, rose at a 1 per cent pace, a deceleration from the prior period.

Applications for US unemployment insurance fell for the first time in 4 weeks but held near the highest level since November, indicating continued moderation in the labour market. Initial unemployment claims decreased by 5,000 to 256,000 in the week ended Jul 23, Labor Department data showed on Thursday (Jul 28). The median estimate in a Bloomberg survey of economists called for 250,000 applications. Continuing claims for state benefits fell to 1.36 million in the week ended Jul 16.

Gold climbed after the US economy shrank for a second consecutive quarter, pushing the US dollar and Treasury yields lower, and clouding the outlook for further aggressive interest rate hikes as the Federal Reserve fights inflation. Bullion rallied as much as 1.2 per cent to a 3-week high after a report on Thursday (Jul 28) showed that US gross domestic product (GDP) fell 0.9 per cent in the second quarter as inflation weighed on consumer spending. The Fed raised rates by 75 basis points on Wednesday, and chairman Jerome Powell said while a similar move was possible again, the pace of hikes will slow at some point.