Subscribe on LinkedIn to stay up to date with every new daily update – a curated selection of essential information on financial markets and the global economy from S&P Global.

The inequality of vaccine deployments around the world and the application of coronavirus containment measures are resulting in an equally uneven economic recovery. Nowhere is this more evident than in emerging market economies.

The health of the world economy depends on the health of the world population. The optimistic outlook calls for a strong global economic recovery in the second quarter or later this year. But these prospects are closely tied to both an effective deployment of the COVID-19 vaccine and collective control of the spread of new variants. Current vaccination efforts and activity levels vary too much from region to region.

Because emerging market economies are suffering the worst of the latest waves of infections, despite intermittent lockdowns, these countries will continue to be highly vulnerable to setbacks from a pandemic, according to S&P Global Ratings. Such conditions could persist even after emerging market economies return to pre-pandemic GDP levels.

“In some emerging market (EM) economies where output is recovering faster, debt and external measures deteriorate more than in emerging countries with slower recoveries, which could have negative implications for economic growth over time. S&P Global Ratings said in a recent report. “Brazil, India, Poland, Thailand and Turkey are examples of emerging countries which outperform in terms of their return to their real GDP before the pandemic, but whose debt or external measures have deteriorated more. than those of their peers in emerging countries. Based on our projections, this dynamic will persist for several years after the COVID-19 slowdown. “

Higher inflation could also hurt emerging market economies. S&P Global Ratings expects the recent surge in inflation in the United States, believed to be transient, to pull out of the economy during the year. But central banks in emerging market economies could tighten monetary policy in the near term, when their country’s economic recovery is fragile, due to rising commodity prices and inflation expectations.

“Rising energy prices should continue to put pressure on headline inflation in the months to come,” said S&P Global Ratings. “This year’s increase in oil prices, combined with the rise in other key commodities such as food, will keep headline inflation on the rise in the months to come and cause central banks to remain belligerent. ”

Today it’s Monday May 17, 2021, and here is the essential intelligence of today.

Market dynamics

Surprise driver for some gas utility revenue beats in the first quarter: winter storm drops

Natural gas utilities reported another strong quarter of profits for the start of 2021, with several gas distributors attributing the tailwinds of the winter storm to earnings that exceeded expectations and strong year-over-year gains to the other. Eight of nine gas utilities from a group selected by S&P Global Market Intelligence posted EPS that exceeded S&P Capital IQ’s consensus normalized earnings estimates. All companies posted year-over-year earnings per share gains, and five of those companies have now posted at least four consecutive quarters of earnings improvement.

—Read the full article from S&P Global Market Intelligence

India CEO Series: Cairn Oil & Gas Says Oil Price Recovery Will Support India’s Upstream Push

Cairn Oil & Gas, Vedanta Limited hopes to double its share of oil and gas production in India over the next few years and is confident that a sustained price recovery will provide ample investment opportunities in the upstream sector, the The company’s deputy CEO, Prachur Sah, who currently heads Cairn’s operations, told S&P Global Platts.

—Read the full article from S&P Global Platts

The credit cycle

The rise in inflation in the United States is transitory and consistent with the recovery of S&P Global Ratings

At first glance, watching the rise in consumer prices in April was baffling. The overall CPI rose above 4.2% year over year (a high of 13 years) and the core CPI rose to 3.0% year over year (a high of 25 years). Unlike much of the market commentary, we weren’t surprised. Indeed, S&P Global Ratings expected inflation to rise as the US economy ramped up the highway on the highway, as GDP jumped 6.4% in the first quarter and S&P Global Ratings expects an 11.3% increase in the second quarter fueled by a faster, faster rollout of vaccination and a reopening schedule in addition to significant cost savings and pent-up demand.

: Read the full report from S&P Global Ratings

Default, transition and recovery: two struggling stock exchanges push the 2021 company’s default count to 41

The number of corporate defaults worldwide this year has risen to 41 after two companies defaulted since the last report by S&P Global Ratings: Switzerland-based catering and procurement provider Gategroup and Delaware-based aircraft leasing company Voyager Aviation Holdings LLC. Both additions to this week’s tally were tied to struggling trades – bringing the total number of defaults related to struggling trades in 2021 to 24 (nearly 60% of global defaults).

: Read the full report from S&P Global Ratings

Technology and Media

Growth of tech giants overshadowed by regulatory risks and advertising challenges

The meteoric rise of big tech in 2021 may soon collapse on Earth amid the specter of new internet regulations and changes in the digital advertising landscape, analysts say.

—Read the full article from S&P Global Market Intelligence

ESG during the COVID-19 era

Ambitions for electric vehicles rocked by political crosswinds in the US market

As the world shifts to an electrified transportation fleet, the United States remains a wildcard when it comes to electric vehicles and battery manufacturing, in large part due to the political polarization in Washington, industry watchers say.

—Read the full article from S&P Global Market Intelligence

Former FERC members welcome shift to environmental justice, with some caution

As the Biden administration raises issues of racial fairness, several former members of the Federal Energy Regulatory Commission have hailed the agency’s recent determination to pay more attention to the implications of its decisions on environmental justice, even as a recent case at FERC highlighted some challenges in balancing competing interests.

—Read the full article from S&P Global Platts

Texas lawmakers are pushing forward eight energy bills; Send two for the governor’s signature

Texas lawmakers in the week ending May 14 brought forward eight bills related to the mid-February storm that cut power to about 4 million customers, two of whom were sent to Gov. Greg Abbot for signature. But none of the eight bills addressed the main concerns related to the degradation of electricity infrastructure.

—Read the full article from S&P Global Platts

The future of energy and raw materials

Listen: Iran Talks, US Sanctions, OPEC + Supply Balancing Dominate Oil Market Geopolitics

Evaluate some of the major geopolitical factors influencing oil markets with Paul Sheldon, Chief Geopolitical Advisor at S&P Global Platts Analytics. The United States and Iran began a fourth round of indirect negotiations this month in Vienna. Sheldon explains why he still sees a good chance that a framework agreement will emerge within weeks and what it would mean for the United States to ease sanctions on petroleum, petrochemicals, shipping and other sectors of the economy. Iran. Sheldon also provides an overview of the June 1 OPEC meeting, takes a more in-depth look at the sustainability of the OPEC + alliance, and gives his outlook for any sanctions easing in Venezuela.

—Listen and subscribe to Capitol Crude, a podcast from S&P Global Platts

United States concerned about anti-competitive concerns over proposed Canadian national acquisition-Kansas City Southern

On May 14, the United States Department of Justice attempted to derail the proposed $ 30.5 billion acquisition of Kansas City Southern by Canadian National, arguing that it presented serious competition concerns to the United States. within the American rail network. Join Now DOJ calls on railroad regulator US Surface Transportation Board to reject Canadian National’s request for a voting trust after STB already approved similar terms for a competing deal by CN’s smaller rival, the Canadian Pacific Railway, to acquire Kansas City Southern for $ 25 billion.

—Read the full article from S&P Global Platts

Slow Speed ​​Iron Ore Exports in Jan-April Need to Increase: Platts Analytics

According to S&P Global Platts Analytics, most of the major iron ore producers fell behind their export forecasts on an annualized basis from January to April, which, together with a slow start in May, indicates an offer potentially low in 2021.

—Read the full article from S&P Global Platts

Written and compiled by Molly Mintz.