Daily Update: January 13, 2022

Start every business day with our analyses of the most pressing developments affecting markets today, alongside a curated selection of our latest and most important insights on the global economy.

Today is Thursday, January 13, 2022, and here is today’s essential intelligence.

Uncertainty in the Global Economy

PE Managers Expect Another Boom Year In 2022

Private equity deal-making and fundraising is expected to continue apace in 2022, although midmarket managers in both the U.S. and Europe are mindful of high valuations and inflationary pressures as they deploy record amounts of cash. In total, 24,722 deals were announced in 2021 worth a disclosed aggregate $1.2 trillion, up from 17,618 deals worth just under half that amount the year before, according to S&P Global Market Intelligence data.

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

Global Airline Passenger Capacity Ends 2021 35% Below Pre-Pandemic Level: OAG

Global airline passenger capacity rose 9% year on year in 2021 but was still 35% below the pre-pandemic level in 2019, with passenger volume lowest since 2009-2010, flight and data analytics firm OAG said in its latest report. OAG said global passenger capacity was at 5.7 billion seats in 2021, with the second half of the year seeing a stronger recovery than the first half.

—Read the full article from S&P Global Platts

The Credit Cycle

2022 Expected To Be Slow Year For Corporate Bankruptcies

U.S. corporate bankruptcies are expected to remain low until late 2022 or 2023 despite a month-over-month uptick in December 2021, experts say. As a whole, there were fewer bankruptcy filings in 2021 than in 2020, with 418 in 2021 compared with 641 the previous year.

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

U.S. Insurance Companies Raise $35B From Debt, Equity Offerings In H2'21

U.S.-based insurance and insurtech companies raised about $35.0 billion from capital markets in the second half of 2021, according to an analysis by S&P Global Market Intelligence, down from $58.17 billion in the first half of 2021, but slightly up from $34.31 billion in the prior-year period.

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

Updated U.S. Transportation Infrastructure Activity Estimates Show Air Travel Normalizing By 2023 And A Stymied Transit Recovery

The prospect of a continued or permanent shift to remote or hybrid work and the growth of online shopping will limit the recovery in public transit ridership and contribute to the longest recovery compared with other U.S. transportation infrastructure asset classes. The recent surge in coronavirus infections from the omicron variant will likely delay the positive momentum gained in the second half of 2021 for air travel, as assumed in S&P Global Ratings’ downside activity estimates.

—Read the full article from S&P Global Ratings

Market Dynamics

Uranium Price Rally Spurs First Exploration Increase Since 2011

Uranium exploration budgets rose 10.7% year over year in 2021, with Canada leading the pack and budgeting $67 million, followed by the U.S. at $10.1 million, according to S&P Global Capital IQ data. Globally, uranium exploration budgets for juniors reached about $94.3 million in 2021, while majors' exploration budgets for uranium totaled approximately $22.7 million, an S&P Global Market Intelligence analysis found.

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

Copper Above $10,000 First Time In Three Months Amid Multiple Factors

The London Metal Exchange three-months copper price was trading at $9,973/mt ($4.52/lb) as of 1130 GMT Jan. 13, against the closing price of $10,604/mt on Jan. 12. Base metals prices were on the front foot again on Jan. 12, with protracted buying pressure resulting in copper pushing past the $10,000/mt mark as investors looked to commodities as inflationary pressures rose, analysts with U.K. brokerage Sucden Financial said in a report Jan. 13.

—Read the full article from S&P Global Platts

Technology & Media

Netflix Shares Slide As Streamer Tees Up Q4 Earnings

Netflix Inc. on Jan. 19 will report fourth-quarter 2021 earnings, and investor sentiment has rarely been as dour. While some analysts still believe Netflix can shake off the naysayers and generate growth amid the highly competitive shift from traditional TV to streaming video, other analysts and many investors increasingly believe the company is overvalued.

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

Chip Shortage To Persist Through 2022 As Smaller Players Feel Bigger Impact

While analysts and experts expect chip shortages to continue throughout the remainder of the year, they believe the big chip companies have been able to adapt. Smaller tech players, meanwhile, are feeling more of a pinch. Many smaller vendors on the show floor were non-committal on street dates for the products they were showing, even for products with planned 2022 release dates, said Kagan analyst Neil Barbour.

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

Julia Haart On The Future Of Tech, Talent, And Social Media

Utilizing emerging technologies in fashion has allowed talent to make a lasting impact on their brands and followers, says Elite World Group CEO Julia Haart. Avatars of EWG's talent and other "metaverse" technologies have played a big role in the success of one of EWG's major clients, Steve Madden. To create a healthier, more inspirational social media environment, Haart teaches her talent to use social media to campaign for causes they care about—and she says Congress can help in these efforts, too.

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

ESG in the Time of COVID-19

Constellation Spin-Off Underscores Nuclear's Role In US Decarbonization Effort

Constellation Energy Corp.'s spin-off from Exelon Corp. arrives at a pivotal moment for nuclear power, with the new company signaling it could be on the hunt for assets and as state and federal policy begins to reflect the technology's value as a carbon-free power source.

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

Higher Carbon Prices In China May Tighten Commodity Supply, Impact Customers: UBS

Higher carbon prices in China could result in tighter supply of commodities like metals and energy, resulting in higher prices that will eventually be passed on to consumers, according to analysts from Swiss investment bank UBS. UBS has projected that China's carbon price is likely to exceed Yuan 200/mtCO2e (about $31/mtCO2e) in the next few years, more than three times the current price level, given stronger demand and tightening supply.

—Read the full article from S&P Global Platts

Ethanol Touted As Complementary Decarbonization Solution To EVs At House Hearing

Emissions reductions benefits from electric vehicles are poised to make a big dent in the U.S.'s carbon footprint over the long term, but the long lead time to overturn the fleet and other challenges demand that policymakers look to other complementary solutions to decarbonize transportation by midcentury, a biofuels advocate said Jan. 12.

—Read the full article from S&P Global Platts

The Future of Energy & Commodities

Commodities 2022: Middle East LPG Exports Seen Higher As Contest Heats Up For Asia Demand

PG exports from major Middle Eastern producers in 2022 are expected to increase 6.6% from 2021 as competition for the growing Asian markets intensifies amid expanding supply from other producers, led by the U.S., traders, producers, and analysts said. Total exports from Qatar, the United Arab Emirates, Saudi Arabia, Kuwait, and Iran are estimated to rise to 38.9 million mt in 2022, up from 36.5 million last year, the sources said.

—Read the full report from S&P Global Platts

Written and compiled by Molly Mintz.