Positive Start to the Q3 Earnings Season

Note: The following is an excerpt from this week’s Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>>

Here are the key points:

  • Earnings releases in the last few days suggest that the positive momentum we started seeing in the overall earnings picture in early July is still very much in place and reflects favorable trends in the U.S. economy.
  • For 2020 Q3, total S&P 500 earnings are expected to decline -23.5% on -3.1% lower revenues. This is an improvement from the -26.5% earnings decline expected at the start of July and follows the -32.1% earnings drop in Q2.
  • Sectors with the weakest Q3 growth outlook remain the social-distancing exposed spaces like Transportation (-122.6% earnings decline), Energy (-100.4%), and Consumer Discretionary (-89.2%).
  • 14 of the 16 Zacks sectors are expected to experience earnings declines
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Semiconductors, Social Distancing & Scientific Stagnation

Welcome to the Capital Note, a newsletter about business, finance and economics. On the menu today: semiconductors, social distancing & scientific stagnation.

Moore’s Law, according to which computing power doubles roughly every two years, has long been the backbone of technological innovation. Smartphones and lightweight laptops were made possible by the steady downsizing of microchips, and, more recently, computationally intensive artificial intelligence-algorithms have gained widespread use thanks to advances in computing power.

While Gordon Moore was referring to central processing units (CPUs), the growth in computing power over the past decade has been driven by graphics processing units (GPUs). Initially intended for graphics-intensive games, GPUs now have the processing power needed for a wide range of AI applications and have thus displaced older chip technologies.

Naturally, the two GPU producers — Nvidia and AMD — have profited handsomely.

Now, Nvidia has agreed to a $40 billion purchase of

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Salem State Ramps Up ‘Your Voice, Your Vote’ Efforts

SALEM, MA — Salem State wants its students to make their voices heard in November.

The Center for Civic Engagement and the Frederick E. Berry Institute of Politics and Civic Engagement have launched their “Your Voice, Your Vote” campaign for 2020 with a series of discussions held virtually that are aimed at educating students and convincing them to vote on Nov. 3.

“We want to give our students the tools to be as informed as possible before they cast their ballots,” said Cynthia Lynch, executive director of the Center for Civic Engagement. “These discussions are designed with our students in mind, and we are hopeful that holding them online will allow more members of the general public to benefit from hearing these talks.”

The school received the Carnegie Classification for community engagement earlier this year. The Center for Civic Engagement will be holding voter drivers and have programming on how

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The SEC’s Chilling Effect on Crypto Development

A slew of regulatory happenings are in the works. First, the Bahamian central bank plans to issue the first CBDC this October while the Indian legislative body is considering a ban on crypto trading. 

Further, the latest SEC injunction into an allegedly unregistered token sale could set a grave precedent, argues Commissioner Hester “Crypto Mom” Peirce.

Top shelf

CBDC first
The Central Bank of the Bahamas has confirmed it is moving ahead with the nationwide launch of its digital currency, called the “Sand Dollar,” sometime in October. Approximately $48,000 worth of the new central bank digital currency (CBDC) – pegged to the U.S. dollar-tracking Bahamian dollar (BSD) – will enter circulation initially with commitments to mint and remove BSDs as necessary. A mobile-based wallet app will also be rolled out. If it sticks to its October release, the Sand Dollar will likely become the first CBDC to launch anywhere in

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Nearly 3 in 4 Americans didn’t take time off this summer

The Daily Beast

Christian Boarding School Shutters After Accusations of Abuse, Depriving Girls of Food

The Circle of Hope Girls’ Ranch, a fundamentalist Baptist reform boarding school for troubled girls in southwest Missouri, is shutting its doors.But the school’s owners insist their decision to close the 14-year institution has nothing to do with the ongoing criminal investigation into a slew of abuse and neglect allegations leveled by former students.“I’m closed for good,” Boyd Householder, 71, told the Kansas City Star in an interview with his 55-year-old wife, Stephanie. “I will not put up with a corrupt sheriff’s department and a current social services department. I will not.”“We’re going to take this all the way,” Householder added, denying ever physically abusing or neglecting former students. “We’re gonna, how do you say it, vindicate ourselves.”Montana Pastor Accused of Abusing His Flock Reopens His Burger Chain to OutrageLast month, Cedar County authorities removed

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Apple’s future involves you paying it every month

Apple unveiled an Apple One subscription service on Tuesday - Bloomberg
Apple unveiled an Apple One subscription service on Tuesday – Bloomberg

We are resigned to certain things taking cash out of our bank accounts every month. The gas bill, council tax, our rent or mortgage payments. In the not-too-distant future, expect another regular charge to start showing up on our bank statements: the Apple bill.

On Tuesday, the iPhone maker announced its long-rumoured equivalent of Amazon’s Prime or Microsoft’s Office 365: a subscription called “Apple One”.  The bundle, which will cost between £15 and £30 a month, will include the company’s digital services of video games, music, cloud storage, fitness, news and video streaming, with the combination changing depending on what tier you choose.

Each service is available separately. But by offering them as a set menu, rather than a la carte, Apple is hoping to raise the total amount that its customers spend on services, drawing more people into

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Trump spent years targeting Indian Americans. Then Biden picked Harris.

Donald Trump has worked for years to make inroads with Indian Americans in ways Republican presidential candidates never have — recruiting volunteers at Indian grocery stores, holding events in five Indian languages and paying for targeted digital ads.

Joe Biden undercut those efforts in a matter of weeks.

First, Biden selected Kamala Harris, the daughter of an Indian mother and Jamaican father, as his running mate. Within days, Harris was speaking to Indian Americans on India’s Independence Day about her grandfather, who helped push for India’s liberation. Then she was boosting the campaign’s launch of a new Indian coalition. And last week, Biden supporters released a video with a song remix from the popular Bollywood movie “Lagaan” about an Indian village fighting British rule.

“There was a level of enthusiasm that came out of the diaspora almost immediately when Sen. Harris was named as the vice presidential nominee,” said Rep.

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House builder’s profit slumps, losses deepen at Galliford Try and Zara sales slide

Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:

House builder’s profit slumps

House builder Redrow (RDW.L) saw its profits slump by two thirds last year as COVID-19 disrupted construction and sales.

Pre-tax profit at the business fell 66% to £140m ($180.5m) in the 12 months to 28 June 2020, the company said. Revenue dropped 37% to £1.3bn.

Chief executive John Tutte said the pandemic had “a profound impact upon the Group’s performance in the 2020 financial year but we entered the new financial year in a position of strength.”

“We have a record order book and brought forward very high levels of work in progress,” he said. “This was due in part, to increased investment earlier in the year in anticipation of strong demand for the Help to Buy scheme ahead of changes to the scheme next year.”

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Bolton hospital pleads ‘don’t come to A&E’ after being overwhelmed by requests for tests

A sign warning Bolton residents to stick to the rules or face a lockdown - Paul Ellis/AFP
A sign warning Bolton residents to stick to the rules or face a lockdown – Paul Ellis/AFP

Health officials have issued an urgent plea to stop the public going to the Royal Bolton Hospital’s A&E department following a surge in requests for Covid-19 tests.

The town in Greater Manchester has the highest coronavirus infection rate in England, with the equivalent of 192 new cases per 100,000 people recorded in the week to Sept 10.

In the last few days, 100 people have turned up at accident and emergency wanting to be tested.

Professor Donna Hall, chair of Bolton NHS Foundation Trust, said: “This failure of the test and trace system is placing huge pressure on the NHS and social care.

“I’ve felt that there has been a real lack of a cohesive strategy for the whole containment of Covid-19 and for test and trace.”

Follow the latest updates below.


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How Yoshihide Suga Can Finish What Shinzo Abe Started

(Bloomberg Opinion) — There was no puff of white smoke, but Japan has a new Prime Minister. Yoshihide Suga, who was Chief Cabinet Secretary under Prime Minster Shinzo Abe, won an overwhelming victory in an internal contest within the long-dominant Liberal Democratic Party. Widely considered to have been one of the chief architects of Abenomics, Suga is likely to keep the government’s focus on resuscitating the economy. His top priorities should be a more efficient corporate culture, gender equality, and raising low-end incomes.

Under Abe, Japan went back to work. Buoyed by monetary easing, the employment rate soared:

This was especially true of women, who entered the workforce in record numbers. Increased immigration also added to labor supply. The coronavirus pandemic will cause employment to fall, but it should bounce back quickly, enabled by continued monetary easing and the fact that Japan’s disease outbreak has been relatively mild.

Encouragingly, productivity

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