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Joe Biden’s Speech at the UN General Assembly, Uber Shares Surge & Evergrande’s Situation

S&P 500 rebounds, as Biden speaks at UN

The benchmark S&P 500 rebounded on Tuesday, a day before September’s much anticipated Fed meeting.

Tuesday’s rally also came as U.S. President Joe Biden spoke at the United Nations General Assembly.

Defending his decision to end America’s presence in Afghanistan, the President stated, “Instead of continuing to fight the wars of the past, we are fixing our eyes and devoting our resources to challenges that hold the keys to our collective future”.

What you need to know…
World leaders gathered today for the 76th session of the United Nations General Assembly (UNGA). Member states discussed ending the COVID-19 pandemic and reactivating the world’s post-pandemic economy.

Joe Biden held most of the attention as he discussed the U.S. Military’s withdrawal from Afghanistan, the newly-forged alliance with Australia as well as climate change. 

Biden’s speech came during the 76th Annual UN Assembly, which was substantially scaled down due to the COVID-19 pandemic.

As of writing, the S&P 500 was marginally higher, with the NASDAQ trading 0.30% higher.

Uber shares surge on profit forecasts

Shares in Uber Technologies were trading higher on Tuesday, as reports circulated that the company was set to report adjusted profits.

After being one of the biggest companies impacted by the COVID-19 outbreak, Uber has quietly regained its footing in recent months.

It is reported that online food orders surged, and ride bookings recovered from pandemic lows last quarter.

Uber’s past with ‘profitability’
Uber has never turned an annual profit and has only posted two quarterly profit totals in the past, both of which relied on gains in its investment in Didi Global Inc.

Under pressure to post a profit, the company has increasingly cut discounts and incentives, one of the reasons prices of rides have climbed higher..

As a result, the company announced that it was expecting adjusted earnings before interest to breakeven in Q3, forecasting a loss of $25 million and a profit of the same figure, compared with the prior reports of a loss of $100 million.

Uber was trading 12.44% higher, as of writing.

Evergrande Chairman issues plea to employees

Chinese Real Estate giant Evergrande was largely blamed for Monday’s stock market selloff; however, the company’s CEO today spoke, attempting to calm market nerves.

Evergrande, which was on the brink of defaulting on its financial obligations, was labelled “Lehman 2.0”, as onlookers anticipated its pending bankruptcy.

What’s going on with Evergrande
Investors around the world have grown increasingly concerned over whether the indebted and troubled Evergrande, a Fortune Global 500 company, could spark a wider shock to the global economy. The worries only grew over the weekend as Dow futures sank as the anxieties over the company defaulting on its enormous $300 billion in estimated debt spread, tanking Evergrande’s own valuation from $24 billion to $5 billion in Hong Kong. 

However, in a letter to employees, Chairman Hui Ka Yuan stated that, “I firmly believe that with your concerted effort and hard work, Evergrande will walk out of its darkest moment, resume full-scale constructions as soon as possible”.

After falling by double digits to start the week, shares in the company were down 0.44% on Tuesday.

The Chinese government has so far showed no signs of coming to the aid of the firm.

Quote of the day – “Confidence is not ‘I will profit on this trade.’ Confidence is ‘I will be fine if I don’t profit from this trade.”

– Yvan Byeajee

Eliman Dambell

Senior Market Analyst

 

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