IMPACT OF THE COVI-19 THAT IT IS HAVING ON THE MARKETS AND COMPANIES.

Updated: May 13, 2020

English and Spain

blog Consenegy 30-03-2020


it should be stated that the international response in principle seems exemplary, taking far-reaching measures Since the G-20 in its communiqué of the meeting held on 03-26-2020, the need for global action by fiscal and financial measures is recognized. support organizations, institutions and governments to be able to implement measures with effect on companies and other economic, fiscal, labor, financial and commercial agents so that the abrupt stop of economic activity, especially the commercial activity of the planet, can be restored in the most efficient as possible once the current confinement of 40% of the world population is lifted. The G-20 will inject $ 5 Trillion into the economies.

At the same time the International Monetary Fund and the World Bank behave to help developing countries by injecting $ 2 trillion.

The Fed and the central banks will apply their monetary policy through injections to the economic one, with bond or fund issues and other financial instruments created for this purpose.

Gurus of the economy preach that the effect on the economic will be similar to the serious crisis that the planet suffered in between 2008-2009 and urge to act without doubt, so that it is not, and without applying austerity measures and applying expansionary measures, so that the pandemic does not crack and break the growth in the economic cycle that most countries found before the emergence of the COVI-19 epidemic.

Let us hope that the will is carried out and all the countries toast from this opening of the main economic economies of the planet to urge the implementation of expansion measures. We can only hope that Europe will join this urgent social and economic situation, without paralyzing the Marshall plan or the issuance of European Debt. This will allow the European Governments of the countries most affected by the pandemic crisis to act, not only to forcefully preach in implementing fiscal, mercantile, labor or financial measures, but also to ensure that these measures can be complied with. more affected than others, but in a month and a half it can be the opposite.

Impact on companies. In this writing I will place more emphasis on the strategies segments and the stock markets.

Stock markets are reflecting panic, with volatility not seen since 2009, marked by the collapse of the Asian stock markets, plunging 30%, S&P 500, Dow Jones and Nasdaq have recorded losses on a day that did not It has been in markets since the 1987 crisis, as have the European stock markets, Ibex, Dax, Cac, Euroo Stoxx50 or the UK FTSE index exchange. They have suffered volatility with similar behavior.

The Chinese authorities to stop this strong fall in companies. Girls have acted in a similar way to the practices that I already used in the deep crisis of the Asian market in 2015, on the one hand the companies issue new shares and on the other, hire stockbrokers. and fund managers to massively buy shares of Chinese companies with the backing of the fund that has already been created by the Chinese Securities Finance Corporation, which has a direct liquidity line with the Chinese Central Bank. One of the companies that has taken control of NHA Group Co through Airline China and other state capital lines.

Another segment of the economy that has been affected by the pandemic of forms is the energy segment of oil, 40% of the planet is confined to their homes, which means that demand for oil has decreased, data from 30 years ago, It added to their own problems. The battle waged by Saudi Arabia and Russia, separate pricing. Therefore the funds are in a selling position of the oil companies.

Within the transport sector, aviation is the most affected by the pandemic: The planes were emptied early in the crisis. And they are collapsing in the markets, a fact that is forcing governments to intervene because it is a strategic segment as we have seen in Italy with the nationalization of Airitalia. Funds top American Funds been purchased from Del Air lines. Investing experts have bought companies like SKyest SKW, spiritAirlines, Trnsdigmgrou, or auxiliary companies of air companies. Taking advantage of low stock prices.

We know the purchase of Delta Air Lines by one of the most prominent funds in the USA, experts talk about purchases to save airlines. such as SkyWest SKYW, -8.94% and SpiritAirlines SAVE, -10.41%. They were also buying stealthy airline games like TransDigmGroup TDG, -9.71%, which sells used parts in the sector.

The Government of the United State of the America has offered financial assistance to these Delta Air Lines (NYSE: DAL), UnitedAirlines Holdings (NASDAQ: UAL), SouthwestAirlines (NYSE: LUV) and American AirlinesGroup (NASDAQ: AAL). The legislation gives the Treasury discretion to offer up to $ 25 billion in direct financial assistance grants, representing money that airlines would use to allow their workers to continue receiving payments until September.

Investment funds are buying important packages of companies, with their significant discounted shares. They were major buyers at Wells Fargo WFC, -2.00% ($ 5.5 million value), PNC FinancialServices PNC, -2.71% ($ 5 million), and Raymond James Financial RJF, -4.67% ($ 1.5 million ), for example.

In Spain, the Spanish Government has taken important measures to protect companies from opportunistic investors. From the historical highs of each one, the market value of Repsol, Telefónica, Santander or BBVA has fallen between 64% and 80%, leaving them within walking distance for some foreign buyer. And it is that these firms have not only suffered in the stock market in recent days, they have also gone through complicated times due to structural issues in their sectors. It has shielded large Spanish companies and introduced measures such as not being able to buy more than 10% of capital during this crisis. The Spanish government, when this crisis is over, must intervene if necessary, as governments are doing in the tourism segment, transportation segment, and energy segment to avoid and protect strategic segments of the country. Either special lines of credit, I am in favor of savings banks, or trust funds from the country or powerful international funds that buy shares in these companies that give security to stakeholders.

The hotel segment will be affected. The World Tourism Organization calculates that the number of world tourists will fall to 3%, everything will depend on the lifting of confinement at a global level that does not exceed more than two months in its entirety. Hotel companies not to freeze reservations are applying significant discounts and canceling cancellation fees. The governments will manage the aid according to the needs of the companies and the needs of the sector. We must bear in mind the impact of the GDP in Spain as in Italy of the tourist segment in very significant.

Retail segment have stopped their commercial activity almost entirely. Inditex, Mango, H&M, Cortefiel, Adolfo Dominguez have closed their stores. El Corte Ingles with partial closings, only offers basic necessities in its stores. This crisis will change everything, all brands are going to strengthen significantly. The grocery stores are all open but have changed all their hours. Mercadona, Consum, Carrefor, Day

In. The continued spread of the COVID-19 coronavirus is forcing almost all retailers across the country to change their hours in some way or form. Whether it's because of the curfew, the need for deep cleanings, or longer resupply periods, it can be difficult for some people to know if their local grocery store would remain open at the start of the crisis, resulting in a massive purchase of products at Initially, Walmart or Target is open. Some companies, like Apple and Sephora, have closed all locations indefinitely. Others are cutting hours. And some, like many gas stations and pharmacies, have not adjusted the hours at all.

n England Primark, Kingfisher, Castorama and Brico Dépôt stores will try to mitigate the impact by offering home delivery services and click and collect services.

This will change society and the market. Distribution and retail companies will have to redefine their strategies in the future to build customer loyalty in the online store-services relationship. Let's not forget that the big brands are not the neighborhood or the neighbor, but the main city and all the cities around it. to say give an idea, put lockers in front of the most representative businesses of the main cities that do not have a physical presence of their stores, in supermarkets or pharmacies. Joining companies such as El Corte Ingles, Inditex, among others. To use this service together. I turn on the loyal customer, and provide proximity services. Although online services are the same but they see a physical presence

For all the companies as a whole, the governments have put in stockings, fiscal, labor, mercantile and financial, that can facilitate the temporary closure of the companies and be as little harmed as possible during the closure they have had to undertake.

Measures that are constantly talked about and we all know with the laws and decrees that governments have had to impose.

For the good of all I hope that all governments act forcefully, without paralyzes and all at the same time it cannot be that Europe was left behind, the US, Asian governments, Latin America, East all these follow the same line, hopefully technocrats or economic gurus or governments with little solidarity and restrictive ideas not get their way and the countries most affected by the pandemics do show solidarity.

If so, and no one prevents it, we will get out of the pandemic and return to the path of economic growth that occurred in most developed countries, to be developed.

I would like their vigilance to be increased in the stock markets, because it should not be forgotten that in times of crisis, some tricks of power, including some governments with unethical practices, can damage or increase their economic power in an unorthodox way.

If this is so, we will soon have forgotten and we will return to absolute normality. Next year the companies will obtain the same results, we will not be able to argue that this year the profits in the income statements of most companies will be reduced. Recovering two or three months will be difficult. But not forget that the action of government reduce these impact .

!Make it only two or three months! If not, more measures will have to be introduced.


IMPACTO DEL COVI-19 QUE ESTA TENIENDO EN LOS MERCADOS Y LAS EMPRESAS.

Cabe constatar que la respuesta internacional en principio parece ejemplar, se están tomando medidas de enorme calado Desde el G-20 en su comunicado de la reunión mantenida el 26-3-2020 se reconoce la necesidad de una actuación global de medidas fiscales y financieras puedan apoyar a las organizaciones , instituciones y gobiernos a poder implementar medidas con efecto sobre las empresas y demás agentes económicos fiscales, laborales , financiera y mercantiles de forma el brusco parón de la actividad económica en especial la actividad comercial del planeta puede restablecerse de la forma mas eficiente posible una vez se alce el confinamiento actualmente del 40% de la población mundial. El G-20 inyectara en las economías $ 5 Trillones.