Daily Update: September 5, 2023 – S&P Global

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As great as last year was for our company, in many ways 2022 is shaping up to be even better. In February, we closed a transformative merger with IHS Markit. We believe combining our two companies will create substantial long-term value for all our stakeholders.
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China’s reach is quietly growing behind minerals critical to a wide range of products that will shape the future. Facing more restrictive foreign investment policies in developed markets, Chinese firms are pursuing such key minerals as lithium and cobalt in other locations.
This is India’s moment. How the country’s governments, business community and civil society meet expectations now – and over the coming decade – will have implications not just for India, but also for the rest of the world.
Commercial real estate in the US is experiencing a confluence of challenges – including secular shifts in demand, the adoption of hybrid work, higher borrowing costs and volatile capital markets, and turmoil in the banking sector.
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Cloud Computing Grows Up But Doesn’t Settle Down
Back in the early 2000s, most companies had a server room to manage their data and communications needs. In these rooms, metal racks held slim servers in horizontal rows with thick nests of blue wires sprouting from their backs. A persistent electronic hum filled every server room as the servers mechanically fulfilled their duties and the air-conditioning fought to keep temperatures bearable. Most of these rooms are now gone. Cloud computing and the need for digital transformation has pushed most companies to repurpose their server rooms. Data, networking, communications and all manner of technological operations have been outsourced to large datacenters. These datacenters are built with redundancy and 99.9% uptime in mind and are managed by technology companies known as hyperscalers. As cloud computing enters its third decade, Melanie Posey, research director for cloud and managed transformation services at 451 Research, a part of S&P Global Market Intelligence, joined the “Next in Tech” podcast with host Eric Hanselman to answer the question “Has cloud gotten boring?
When cloud computing was first adopted, it represented a fundamentally new paradigm. Trusting critical business processes to a third-party host was unthinkable for many companies. However, cloud computing has become the conventional way to handle operations for most companies. 
“Not that cloud technology is boring necessarily, but it has been baked into the cake as far as infrastructure options, and I think, in a broad sense, that’s where we are now,” Posey said. “Cloud is a way of doing things and not necessarily a thing itself, and it’s a modality that infrastructure uses to get the resources to the folks to do their thing.”
However, cloud computing remains inextricable from the cutting edge. As technologies such as generative AI begin to be adopted by companies, it is easier to access these technologies through niche cloud providers than to build the systems in-house.
“The cloud infrastructure is the foundation of all these cool new things that are happening right now with [generative] AI, and edge computing is an additional venue where some of those cool things happen,” Posey said. 
One area of continued development for cloud computing is operational infrastructure for cloud computing resources. The transformation to cloud computing from on-site servers changed a lot of information technology to an operational expenditure from a capital expenditure. This necessitated the development of tools that manage operational investments such as financial operations.
“I think part of the continued maturation process is coming from organizations who are using cloud … [and wondering] how to keep costs under control,” Posey said. “And that’s led to this whole area that’s popped up seemingly out of nowhere, but not really, called [financial operations] as a way to programmatically track, report and analyze cloud costs — have a software engine essentially give you recommendations.”
While cloud has not gotten boring, it has grown more complex. Smaller, more niche vendors coexist with large hyperscalers such as Amazon Web Services, and companies need to master the art of managing multiple clouds from multiple providers.
Today is Tuesday, September 5, 2023, and here is today’s essential intelligence.
Written by Nathan Hunt.

Economic Research: Fiscal Initiatives Boost U.S. Economy Amid Headwinds From Tighter Monetary Policy

U.S. economic growth continues to be better than S&P Global Ratings’ forecasts. In the second quarter, the economy expanded 2.1% on a seasonally adjusted annualized basis after increasing 2.0% in the first quarter. The latest running estimate of real GDP growth for the third quarter is 4.8% (average of Atlanta Federal Reserve’s GDPNow and S&P Market Intelligence GDP Tracker estimates), which points to yet another quarter of at- or above-trend growth pace.
—Read the report from S&P Global Ratings

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Bankers Less Optimistic On Future Growth — S&P Survey

Between June 7 and July 7, S&P Global Market Intelligence surveyed US banking executives and found that just slightly over half of bankers, 51.4%, expect the total value of loans to increase over the next 12 months at their organization, down from 64.2% in the first-quarter survey and 69.0% in the fourth-quarter 2022 survey. Meanwhile, the percentage of survey participants who expect loans to remain flat at their institution over the next year increased to 24.6%, up from 19.1% and 14.4% in the previous two surveys, respectively.
—Read the article from S&P Global Market Intelligence

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US Factory Gloom Deepens As Production And Order Book Downturns Intensify In August

US manufacturers reported another tough month of trading in August. Output has fallen back into decline after a brief respite in July amid an increasingly steep deterioration in order books. Orders are in fact falling faster than factories are cutting output, suggesting firms will need to continue scaling back their production volumes into the near future. An increasing sense of gloom about the near-term outlook has meanwhile hit hiring and led to a further major pull-back in purchasing activity.
—Read the article from S&P Global Market Intelligence

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Listen: How The Global ESG Recruiting Landscape Is Changing

As the US heads into Labor Day weekend, ESG Insider is once again turning its focus to the topic of sustainability recruiting and how the hunt for global ESG talent is changing. In this episode of the ESG Insider podcast, hear from two recruiters focused squarely on the sustainability space.
—Listen and subscribe to ESG Insider, a podcast from S&P Global Sustainable1

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APPEC: Asian Refiners To Embrace Middle Eastern Sour Crude Regardless Of Price Swings

Asian and Persian Gulf refineries will continue to depend heavily on Middle Eastern crude grades as their staple diet, regardless of price swings and changes in key benchmark spreads, because there’s a limit to how much light sweet US crude would be able to take up the refiners’ crude slate, industry executives and trading sources said at the Asia Pacific Petroleum Conference 2023 organized by S&P Global Commodity Insights.
—Read the article from S&P Global Commodity Insights

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Netflix, Amazon Prime Video And Disney+ Dominate Global SVOD Viewing Hours

Three global subscription video-on-demand services — Netflix Inc., Amazon.com Inc.’s Amazon Prime Video and Walt Disney Co.’s Disney+ — account for the majority of daily SVOD viewing hours in markets surveyed in Asia, Europe and the US, according to Kagan’s Consumer Insights surveys. Netflix average viewing hours are significantly higher than Amazon Prime Video or Disney+ in all surveyed markets other than India, where Disney+ Hotstar usage is on par with Netflix, according to recent Kagan’s Consumers Insights surveys.
—Read the article from S&P Global Market Intelligence

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