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UK economy suffers a total lockdown decline of 25%, global stocks lost $2.8trn in market cap last week, divorce reforms may be risky for women and how is the pandemic affecting women entrepreneurs?
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UK economy suffers a total lockdown decline of 25%, global stocks lost $2.8trn in market cap last week, divorce reforms may be risky for women and how is the pandemic affecting women entrepreneurs?

Weekly newsletter for women who want to be smart about money: financial news, personal finance and investing

Welcome to our #24 weekly newsletter in 2020.

Every week we curate key articles and content so you can stay informed and inspired about money and investing. And we spend hours sifting through content every week so you don’t have to.

We apply a female-lens to news and content about money and investing so that it is more meaningful to you.

Stay in the know. Keep on top of global economic, financial and investing news and trends. And read about what this means for you and your money in 2020 during Covid-19 and beyond.

If you’re short on time, listen to the editorial on audio for a brief overview.

“When we take money matters into our own hands, we can live life on our terms”

-Jana Hlistova

Source: Anna Shvets


From The Purse…

Editorial from the Founder


UK GDP has declined by 25.1% in the first half of this year and it is expected that the UK will suffer the worst damage from Covid-19 of any country in the developed world.

The Bank of England (BoE) has predicted that the UK would experience the worst recession in 300 years and it also forecast a relatively rapid recovery.

So whilst the UK economy is expected to fall by 14% in 2020, it is predicted to recover by 15% in 2021. Therefore the economic damage is expected to be 1.5% of GDP.

The Bank of England (BoE) has reinforced the message that they are ready to take more action to support the UK economy. It is expected that they will announce at least £100bn in bond-buying this week.

Meanwhile the Federal Reserve made a ‘dire’ assessment of the US economy and its prospects of the years ahead which has rattled investors.

The global stock markets lost $2.8trn market cap last week: investors are also concerned about a coronavirus ‘second wave’ and Trump’s poor poll numbers.

In the ‘Companies to Watch’ section, AstraZeneca is eyeing up Gilead, the Zara owner is set to close 1200 fashion shops and Just Eat has acquired Grubhub for $7.3bn to become the biggest food delivery service outside of China.

Read about why quickie divorces in the UK may present a long-term risk for women and how the pandemic is affecting women entrepreneurs at work and at home.

And we’re tracking Serena Williams’ venture fund called Serena Ventures which invests in minority and female-led start-ups which are socially responsible.

Stay safe, look after yourself and your loved ones.

I hope you enjoy this week’s newsletter. Until next week!

Jana


The Big Picture

Global markets and economy news, trends and indicators


The Coronavirus Effect:

  • Stocks markets in the US and Europe suffered their worst one-day falls since March (Thursday)

    • Investors were unnerved by the Federal Reserve’s dire assessment of the economic prospects and fresh concerns about a second wave of coronavirus infections.

    • The S&P 500 fell 6%, its worst day since March 16 and the Nasdaq fell 5.3% (retreating from its all-time high).

    • The UK’s FTSE 100 closed down 4% and the German Dax Xetra 4.5%.


Looking Ahead in 2020/2021



Coronavirus Impact: Your Money

Insights, trends and what this means for you and your money


  • How to fight the coronavirus with your investment portfolio

    • Covid-19 response bonds were created to finance projects aiming to address the coronavirus outbreak.

    • Demand for Covid-19 response bonds has been strong with the new market already reaching $65bn by the end of May and this figure only continues to rise. 

    • According to Morgan Stanley, a combined $32bn of social and sustainability bonds were issued in April, and most were designed for the Covid-19 response initiatives. 

  • UK households face £6bn debts because of Covid-19, says charity

    • According to charity StepChange Britons will rack up debt due to the pandemic as people fall behind on credit card payments, council tax and utility bills. Approximately 4.6m households have been affected so far.

    • This is amid the biggest ever fall in consumer spending and UK households repaid £7.4bn in credit card debt.

  • Americans spend billions to look good during lockdown

    • In the 12 weeks since the start of March, overall US health and beauty sales rose by $3.74bn or 13% from a year ago to $32.2bn.

    • Ecommerce led the increase, up 31% to $9.28bn, encouraged by social media influencers who have been providing self-care tips.


Companies to Watch: winners & losers

Companies to watch and share price movements


  • Zara owner to close 1200 fashion stores around the world

    • Inditex, one of the world’s largest clothing retailers, has been hit hard during the pandemic, with sales down 44% to €3.3bn (£2.9bn) between 1 February and 30 April, the first quarter of its financial year.

    • The company reported a net loss of €409m during the quarter. Almost a quarter of its shops remained closed by 8 June.

    • However, online sales growth made up for some of the sales weakness, Inditex said. Online sales rose by 50% year-on-year during the quarter, and were up 95% year-on-year in April.

  • Just Eat acquires Grubhub in a $7.3bn deal

    • When the merger is complete, Just Eat will become the world’s biggest food delivery company outside of China.

    • In after hours trading, Grubhub shares surged 7%.

    • Just Eat will have 70m active customers globally.


In the Spotlight

Is there a topic you'd like us to Spotlight? Please tweet @jointhepurse


What is the difference between value and growth investing?

  • Value investors look for underpriced, unglamorous or ignored stocks which can be bought at a cheaper price and represent ‘latent value’ over the long term. However without economic growth, many failed to deliver returns.

  • On the other hand, growth investors focus on stocks which tend to outperform their peers. Growth investing tends to be higher risk and relies on strong outperformance of a few ‘outliers’ delivering above average returns. For example, technology stocks such as Google and Apple are often referred to as growth stocks.

  • (Source: FT)


Have You Seen This?

Female-focused news, reports, research, campaigns


  • 1 in 4 pregnant women have experienced discrimination at work during the pandemic, study shows

    • Survey by the Trade Unions Congress (TUC): one quarter of the 3,400 women surveyed who have been pregnant or are on maternity leave, have been singled out for furlough or redundancy.

    • Some women were forced to take sick leave even though they were not unwell whilst others were told to take maternity leave early as the employer could not ensure a safe working environment.

    • Such actions are against the law given that all employers are required to ensure their place of work is safe for everyone according to a Covid-19 risk assessment, and this includes accommodating for pregnant women and new mothers.

  • Quickie divorce reforms risk long-term problems for women

    • In the biggest shake-up in divorce law for 50 years, divorcing couples no longer need to attribute fault.

    • Personal finance experts are concerned that this may lead to private arrangements without professional advice therefore the mismanagement of pension assets.

    • According to research by the Pensions Policy Institute the average divorced woman has at least a third of the pension wealth of the average divorced man. And DIY divorces could increase the gap significantly.

    • Please contact the Pensions Advisory Service for impartial and free advice.

  • From furlough to tax relief: how women’s pensions will be affected by coronavirus for decades to come

    • Whilst the gender pay gap is 17%, the gender pension gap published before the pandemic was 51.4% for ethnic minority women.

    • Women are a third more likely than men to work in a sector shut down due to the pandemic.

    • And more women than men are being furloughed often to look after children.

    • This reduces how much women earn, how much they save and pay into their pensions, whether they receive employer pension contributions and how much tax relief they receive.

  • (US) Pandemic impacts entrepreneuring women at work and at home

    • According to The Diana International Research Institute (DIRI):

      • For the majority of responders ie 67.9% revenue had declined and only 8.1% saw an increase as their product or service was a good fit for the remote environment.

      • Nearly 40% of responders are deferring or reducing executive pay, one third are delaying payment and one quarter are reducing employee hours.

      • Women-owned businesses are experiencing structural inequalities due to the smaller size and age of business and because their businesses are overrepresented in industries hardest hit by the pandemic.

      • Women’s ability to adapt their business to these challenging circumstances is further impacted by family care responsibilities at home.

      • On a positive note, two-thirds of women entrepreneurs have found the best support and resources in other business owners and entrepreneurs.

  • (US) In a survey conducted by 500 Startups, two-thirds of female founders say that the pandemic crisis will disproportionately affect them compared to male founders:

    • The biggest challenges cited by respondents during the crisis were customer acquisition, increasing runway and maintaining a healthy work-life balance. 

    • A third of respondents said that running a company while taking care of family members at home has been “very difficult” or “impossible” to manage.

    • The majority (69%) said that they have six months or less of runway, while 40% said they anticipate that they will need more time to meet fundraising goals.


What We’re Tracking

Female-focused products or services, crowdfunding campaigns, start-ups and businesses led by female entrepreneurs & investment, research


  • SerenaVentures: (US)-founded by tennis player Serena Williams, the venture fund is focused on investing in minority and female led startups which are socially responsible.

    • They have made 60% diverse founder investments, the fund has a $12bn market cap and include 30+ portfolio companies.

    • Their investments include The Wing, Mayvenn and billie.

  • Audrey Gelman, the Co-founder of The Wing resigns

    • Audrey has been criticised for the company’s treatment of black and brown employees.

    • She maintains equity ownership over 10% and will remain on the board.

    • Audrey founded The Wing in 2016 ‘with the idea that women in gig-economy New York needed a place to take meetings, network and refresh their makeup’.


Money Habits of the Week

Do you have a money habit you would like to share with us? Tweet @jointhepurse


‘Check in’ to see how you are feeling about your money right now.

Track your daily feelings and observations in a journal and take note of your spending and/saving habits.

Share any insights you may have with a friend or your partner.


What We’re Watching


  • Watch this TED Talk by Niti Bhan studies business strategy for Africa's informal markets: the small shops and stands, skilled craftspeople and labourers who are the invisible engine that keeps the continent's economy running.

  • Niti Bhan discovers and makes tangible pragmatic opportunities for sustainable and inclusive value creation.


Coffee Break? Read This



We’d love to hear from you. Do you have feedback? Get in touch with Jana via the The Purse website or tweet @jointhepurse and @janicka.

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