Money
Survival of the richest: Dubai Govt pumps more money into Emirates
Emirates has received an additional $1.1 billion from the Dubai government
After recording a massive loss of $5.5 billion on Tuesday, the latest injection Emirates has received has risen to $3.1 billion, including $2 billion disclosed last year.
The airliner which made a $288 million profit the previous year saw saw revenue plunge 66% to $8.4 billion.
The international airline operates a fleet of 113 Airbus A380’s and 146 Boeing 777’s.
Emirates doesn’t fly or operate local/domestic routes and has been heavily impacted by international border closures in many countries such as Australia, which remains closed.
Emirates Chairman Sheikh Ahmed bin Saeed Al Maktoum says the recovery from the pandemic would be ‘patchy’, cautioning that no one could predict when the industry’s worst crisis would end.
The airliner stated that it had filled just 44.3% of seats on flights in the past year, down from an average of 78.4% a year earlier.
EK carried 6.6 million passengers, its lowest in two decades.
The airline cut capacity by 82.6% compared with the previous year as it centred operations around its 146 Boeing 777s.
Emirates reverted 19 of its Boeing 777 aircraft, stripping the seats to carry more cargo.
Most of the airline’s Airbus A380s have been grounded. Four more have been removed from operation and are unlikely to return before their scheduled retirement, it said.
The biggest loss in 30 years
It was the airline’s biggest annual loss, and only its third-ever following losses in 1987-88 and 1985-86, its first year in operation.
Emirates stated that the government who is its sole shareholder, would continue to support the airline.
Emirates has transformed Dubai into a major international travel hub over the past three decades, bringing billions of dollars from tourists into the country.
Both Emirates and Qatar Airways have no domestic markets to cushion against border restrictions and closures.
Qatar and Etihad results
Fellow Gulf carrier Qatar Airways, which is due to report results for its fiscal year ending March 31, has also received $3 billion from its state owner.
Abu Dhabi government-owned Etihad, which posted a core operating loss of $1.7 billion in 2010, has also slashed jobs and retired aircraft such as the superjumbo A380.
The pandemic has seen passenger revenue continue to slump.
In 2019, revenue fell 74% to $1.2 billion from $4.8 billion in 2019, as passenger numbers dropped 76% to 4.2 million, down from 17.5 million in 2019.
Etihad has recorded losses for the past five years.
Money
US stocks face tests from Tesla, Netflix earnings
US markets brace for Tesla and Netflix earnings amid rising volatility and delayed inflation data
US markets brace for Tesla and Netflix earnings amid rising volatility and delayed inflation data
– Earnings reports from Tesla and Netflix might affect U.S. stock performance next week amid high inflation concerns.
– Increased market volatility arises from U.S.-China trade tensions and fewer S&P 500 stocks in an uptrend.
The S&P 500 entered its fourth year of growth amidst these fluctuations, having previously experienced a period of calm. Experts suggest market risks are intensifying as valuations reach peak levels.
Market Volatility
Concerns regarding U.S.-China trade relations escalated last week when the U.S. threatened to raise tariffs by November 1 over China’s rare-earth export policies. President Donald Trump is scheduled to meet with President Xi Jinping in two weeks to discuss these issues.
Despite these challenges, major stock indexes gained ground over the week, with the S&P 500 up 13.3% year-to-date. However, a noticeable decline in the number of S&P 500 stocks in an uptrend raises caution among investors about underlying market weaknesses.
The upcoming third-quarter earnings will be closely monitored, especially as the government shutdown halts economic data releases. Companies like Procter & Gamble, Coca-Cola, RTX, and IBM are due to report. The delayed U.S. consumer price index is also expected to provide crucial insights ahead of the Federal Reserve’s monetary policy meeting on October 28-29.
Money
Australia’s unemployment rate rises to 4.5 per cent
Australia’s unemployment rate rises to 4.5 per cent in September, prompting calls for potential Reserve Bank interest rate cut
Australia’s unemployment rate rises to 4.5 per cent in September, prompting calls for potential Reserve Bank interest rate cut
– Australia’s unemployment rate rose to 4.5% in September, the highest since November 2021.
– Economists note a cooling labour market, with fewer job ads and increased participation rate amid rising living costs.
Economists suggest that the Reserve Bank should consider another interest rate cut next month. BetaShares chief economist David Bassanese noted a slowdown in employment demand as the labour market struggles to accommodate job seekers.
The number of officially unemployed rose by 33,900 in September, while the employment count increased by 14,900. The labour force expanded by 48,800 people, resulting in a participation rate rise of 0.1 percentage points to 67 per cent, returning to July levels.
In trend terms, the unemployment rate remained steady at 4.3 per cent.
Labour Market
BDO chief economist Anders Magnusson stated that while the unemployment rate has increased, the labour market is cooling, not collapsing.
He pointed out that the 14,900 jobs added in September were slightly below the average for the past year.
A growing participation rate indicates that rising living costs are prompting more individuals to seek employment. Magnusson said the release confirms a gradual cooling of the labour market that keeps the Reserve Bank on track without necessitating immediate action.
He added that hiring activity is slowing, signalled by a 3.3 per cent drop in job advertisements in September, the largest monthly decrease since February 2024.
Despite this, he does not foresee a rate cut in November.
Money
Stocks rebound after Trump eases China trade tensions
Stocks rebound 600 points as Trump eases China trade tensions, signalling optimism in markets following Friday’s sell-off
Stocks rebound 600 points as Trump eases China trade tensions, signalling optimism in markets following Friday’s sell-off
– Stocks rose on Monday after Trump expressed optimism about trade relations with China.
– The Dow Jones gained 621 points, with significant increases in tech stocks and broad market recovery.
Oracle’s stock surged over 5%, with AMD and Nvidia seeing 1% and 3% increases, respectively. Broadcom’s stock jumped 10% following the announcement of a partnership with OpenAI.
Trump’s comments hinted that he might not impose a significant increase in tariffs on China, which had previously caused market turmoil. Vice President JD Vance similarly indicated a willingness to negotiate with China, while also asserting that the U.S. holds advantages in potential trade discussions.
Broader Recovery
Monday’s trading saw a positive shift with four out of five S&P 500 stocks rising, indicating widespread recovery. Small-cap stocks also made gains, with the Russell 2000 rising over 2.5%.
Market concerns persist, however, with a government shutdown continuing and a major payroll deadline approaching on October 15. Earnings reports from major financial institutions, including Citigroup and JPMorgan Chase, are expected this week, potentially impacting market sentiment.
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