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NGL revenues surge in Q2; economic rebound underway; Lumen's dilemma

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Q2'21 U.S. Power Forecast

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Battery Metals Trends

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Netflix amortized content spend estimated at $13.6 billion in 2021


NGL revenues surge in Q2; economic rebound underway; Lumen's dilemma

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In this edition, we take a close look at the second-quarter natural gas liquid, or NGL, revenues of top U.S. shale producers. Revenues skyrocketed amid rising prices from the same period a year earlier, as 10 of the largest oil and gas producers posted year-over-year boosts in realized NGL prices of 104% to as high as 261%. These prices are expected to keep increasing throughout the rest of 2021 as demand for liquified petroleum gas remains high.

After roughly four months of flattening, the Treasury yield curve is steepening again, as the government bond market reflects growing expectations for a robust rebound and a healthy, post-pandemic economy.

The time for Lumen Technologies executives to decide between investing in its network and funding its generous dividend has come now, according to analysts. Cash from recent divestments has given Lumen financial capacity to invest in further fiber deployment in its remaining businesses, but analysts noted that the strategy will challenge the company's ability to support its dividend long term.

Shale Gas Drillers and Producers in Focus

Shale gas drillers keep spending down, rake in cash

Pure-play shale gas drillers kept to low-growth drilling plans and reaped the free cash flow from significantly higher natural gas prices. They plan to continue to pay down debt but have hinted at shareholder returns in 2022.

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

Top shale producers rake in higher NGL revenues in Q2 as prices keep soaring

During the second quarter, 10 of the largest oil and gas producers covered by S&P Global Market Intelligence saw their NGL revenues grow dramatically from the same year-ago period as NGL prices climbed sharply year-over-year.

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

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Deep Dives

In-depth features looking at the impact of major news developments in key industries.

Financials

Credit unions buy 3 banks in 1 week, riling industry lobbyists

After three credit union-bank deal announcements in one week, banking industry groups are reiterating their calls for state and federal regulators to put a stop to the deals.

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

End of PPP dents US community bank loan growth in Q2

As the Paycheck Protection Program came to an end in the second quarter, many community banks struggled to make up for the lost loans.

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

US bank margins continue to take a beating

U.S. bank margins drifted even lower in the second quarter as institutions' balance sheets remained bloated with excess liquidity.

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

Spanish banks look to leaner future as cost-cutting plans survive union pushback

CaixaBank's recent agreement with unions concludes a round of restructuring at Spain's largest banks that has seen more than 14,000 jobs lost and the closure of thousands of branches.

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

Insurance

Listed insurtechs struggling to replicate Lemonade's post-IPO success

Shares in Bright Health, Oscar Health, Metromile and Clover Health have all traded lower since making their public market debuts earlier this year, and Kin Insurance may experience a similar trend.

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

MetLife's Khalaf emerges as highest-paid US life insurance CEO in 2020

Lincoln National's Dennis Glass, the most highly compensated CEO in 2019, dropped to the No. 3 spot in 2020.

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

Credit and Markets

Treasury yield curve steepens as bond market signals economic rebound underway

After steepening quickly earlier this year, the yield curve flattened on poor jobs data and a supply bottleneck. Fixed-income analysts said the bottom has been reached and the bond market could be showing expectations for a strong economic recovery.

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

Fed installs 'smoke detectors' for overnight lending markets

Two years after significant turmoil in the repurchase agreement market, the Federal Reserve established two standing facilities that experts say should limit episodes of severe volatility in a critical corner of financial markets.

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

August retail market: US sales worse than expected as spending moves to services

Supply chain issues also affected consumers' ability to buy, experts said, while the spread of the coronavirus delta variant is also a key concern.

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

Energy and Utilities

Hydro makes up more than one-fourth of Western US, Canada resources

Hydroelectric resources are expected to make up about 6% of U.S. power generation supply this year, but they compose a larger share in some areas of the country.

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

Democrats eye 'essential' alternative to Wall Street for green energy incentives

Congressional Democrats are calling for developers of renewable energy projects to be allowed to claim cash payments in lieu of tax credits, a move lawmakers say would drive more investment in the industry.

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

As Xcel Energy CEO departs, utility will keep fueling growth with clean energy

"You know, a lot of people talk about things. We actually are doing it," outgoing Xcel Energy CEO Benjamin Fowke said in an interview with S&P Global Market Intelligence.

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

ESG

Extreme weather, citizen backlash jeopardize California's climate plans

The Golden State faces a perfect storm of drought, wildfires, tight power supplies and, now, intensifying local opposition to large-scale renewable energy projects.

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

What businesses, investors need to know about UN's explosive new climate report

Past findings by the U.N.'s Intergovernmental Panel on Climate Change have driven important climate-related policy changes and investor engagement.

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

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Fintech

UK fintech market running hot but fears of a bubble are premature

The value of financial technology investments in the U.K. hit $5.7 billion in the first half of 2021, according to data from Innovate Finance, well above pre-pandemic levels.

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

Healthcare

Chinese drugmakers ramp up US FDA applications amid domestic pricing pressures

Drug developers in China have filed five applications with the U.S. Food and Drug Administration in 2021, compared to three in 2019 and two in 2020.

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

Technology, Media and Telecommunications

Gaming companies turn to new releases, mobile to maintain growth post-COVID

The major U.S. video game publishers continue to forecast growth driven by upcoming launches for flagship titles and an expanding mobile business, even as the industry's pandemic-fueled sales frenzy shows signs of a slowdown.

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

Lumen's dilemma: Dividend vs. fiber deployment

Lumen executives say that a time may come when the company has to decide between investing in its network and funding its generous dividend. Analysts believe that time is now.

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

Leveraged Finance

US leveraged loan Weakest Links count falls below pre-pandemic level

The second quarter marked the fourth consecutive quarterly decline from the pandemic-era peak in June 2020, and the biggest quarter-over-quarter reduction during this period.

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

Metals and Mining

Inflation-stoking commodity prices may weather China demand slowdown

High commodity prices have fed into U.S. inflation as China's economic rebound drove demand for raw materials. While the Chinese economy is showing signs of slowing, commodity prices may not fall far as support comes from the growing U.S. economy.

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

The Week in M&A

JPMorgan, Lloyds moves may spur more wealth management fintech deals at UK banks

Read full article

National Australia Bank bets on credit card revival with Citi assets acquisition

Read full article

Algonquin Power open to utility M&A as part of green fleet strategy

Read full article

DouYu, HUYA execs say strategic priorities largely unchanged by merger failure

Read full article

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