FT News Briefing Is the US in a recession?
Jul 29, 2022
The U.S. economy is showing signs of contraction, raising recession concerns despite a strong labor market. Meanwhile, EDF faces significant financial hurdles, contrasting sharply with soaring profits from other energy giants. In tech, companies like Meta and Alphabet reveal mixed earnings, creating unpredictable market reactions. Investor sentiment is cautious, with fears of recession looming large, causing even slight positive news to trigger noteworthy market shifts.
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US Recession?
- The US economy has shrunk for two consecutive quarters, meeting one common definition of a recession.
- However, the National Bureau of Economic Research (NBER) uses broader criteria, including labor market data, and is not expected to declare a recession yet.
EDF's Losses
- While energy companies like Shell profit from high energy prices, French utility EDF recorded a significant loss.
- This is due to a corrosion problem in nuclear reactors, forcing outages and requiring EDF to buy electricity instead of selling it.
Mixed Tech Earnings
- Tech earnings reports this week were a mixed bag, with Meta's revenue declining and Alphabet's growth slowing, while Spotify saw an increase.
- Market reactions were unpredictable, with some stocks rising despite bad news due to low investor sentiment.