Despite a bleak macroeconomic picture, Indonesia’s non-life insurance market is well-diversified and underpinned by solid capitalisation, supporting a stable outlook assigned to the segment, according to a new AM Best report.

A new Best’s Market Segment Report, titled, “Market Segment Outlook: Indonesia Non-Life Insurance,” states that the non-life insurance market’s overall robust return on equity, supported by stable historical underwriting performance and strong balance sheet fundamentals, along with good government support including infrastructure plans and economic stimulus, are factors in the stable outlook.

The Indonesia non-life insurance market expanded by 14% year over year, to IDR 79.7 trillion (USD 5.4 billion) in 2019 from IDR 69.9 trillion (USD 4.9 billion) in the previous year, supported mainly by strong growth in credit insurance. Gross premium written (GPW) for credit insurance, the market’s third largest business line, increased by 86.2% to IDR 14.6 trillion in 2019. Property insurance, the largest business segment, also posted solid GPW growth of 9.7% to IDR 20.9 trillion. However, motor insurance GPW recorded muted growth of 0.3%.

AM Best believes that the non-life market in Indonesia benefits from a good business mix that will help to cushion any negative impact from the COVID-19 pandemic. Unlike other markets, which feature motor and health as the largest lines of business, Indonesia’s non-life segment is dominated by property and motor insurance, while credit, personal accident and health lines account for significant portions of total non-life GPW. Collectively, these five lines make up over 80% of the country’s non-life insurance premiums.

However, the decline in economic activity has had a direct impact on the non-life insurance segment. Non-life GPW in the first half of 2020 declined by 6.1% year over year, with the steepest falls in premiums were seen in the property and motor lines of business. Property insurance GPW

(Reuters) – Goldman Sachs said the outcome of U.S. elections would not impact its bullish oil and natural gas outlook and that an overwhelming Democratic victory could be a positive catalyst for these sectors.

Goldman reiterated its bullish 2021 view for both natural gas and oil, saying drivers for higher prices supersede the potential outcomes of the U.S. election.

“The recent gyration in oil prices, rallying on days of higher expected stimulus and weakening dollar, suggest that a Biden election and blue sweep could in fact prove a bullish catalyst for oil,” the bank said, adding that natural gas prices could rally too.

Opinion polls show presidential candidate Joe Biden with a substantial lead over President Donald Trump nationally, although with a narrower advantage in some of the states that may decide the Nov. 3 election.

Headwinds to U.S. oil and gas production would rise further under a Biden administration, with the potential for regulations raising the cost of shale production and reducing recoverable shale resources, Goldman added.

Biden’s climate priorities also point to a faster deployment of renewable sources of energy than currently expected, Goldman said, adding such an agenda would require new infrastructure, which alongside a likely large initial fiscal stimulus, would lead to higher oil demand in coming years.

(Reporting by Nakul Iyer and Eileen Soreng in Bengaluru. Editing by Gerry Doyle)

Copyright 2020 Thomson Reuters.

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HCA Healthcare  (HCA) – Get Report was rising Friday after the hospital operator provided third-quarter revenue guidance that exceeded Wall Street’s expectations.

Shares of the Nashville-based company were up 2.5% to $135.10.

HCA said it expects revenue to roughly total $13.3 billion, up from $12.69 billion a year ago, and ahead of FactSet’s call for revenue to be flat with a year earlier.

The company said it expects income before income taxes to come to $950 million, down from $979 million a year ago. 

This reflects a reversal of $822 million in government stimulus income recorded in the second quarter of 2020 related to general distribution funds under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

HCA said it will return, or repay early, about $6 billion of government assistance funds received as part of the CARES Act.

The company said had taken a conservative approach during the early days of the pandemic,  which “included a number of actions to meet the operational and financial challenges this global health crisis was expected to present.”

“As the initial immediacy of the emergency has passed, and with more information, and more experience managing our operations during the pandemic, we believe returning these taxpayer dollars is appropriate and the socially responsible thing to do,”  Sam Hazen, CEO, said in a statement.

HCA Healthcare is able to return, or repay early, all of its share of Provider Relief Fund distributions of about $1.6 billion and roughly $4.4 billion in Medicare accelerated payments.

Hazen added that “we greatly appreciate the CARES Act funding and the policymakers who fought hard to ensure hospitals would have the essential resources during the pandemic.”

HCA Healthcare said it expects to report full results Oct. 26.

By Allison Lampert

MONTREAL (Reuters) – Honeywell Aerospace <HON.N> on Tuesday cut its outlook for business jet deliveries, but held out hope that most future orders would escape the punishing effect of the COVID-19 crisis that has battered the aviation sector.

Honeywell’s 2020 business aviation outlook forecasts up to 7,300 new business jet deliveries worth $235 billion from 2021 to 2030, down 4% from the same 10-year forecast a year ago.

Yet 80% of business jet operators surveyed in the outlook say their aircraft purchase plans have not been affected by COVID-19, it said.

Corporate planemakers like Canada’s Bombardier Inc <BBDb.TO>, U.S.-based General Dynamics Corp’s <GD.N> Gulfstream Aerospace, and France’s Dassault Aviation SA <AVMD.PA> are closely watching to see if a summer rebound in corporate flights will last and generate demand for new aircraft.

“We are seeing corporate customers expressing interest in growing their fleets so they can fly more executives and others privately, to safeguard employees’ health and prevent disruptions to their business,” Scott Neal, Gulfstream’s senior vice president of worldwide sales, said by email.

Private flights, which carry smaller groups and promise wealthy passengers less risk of exposure to the coronavirus, have generally fared better than those of commercial airlines, with operators like NetJets and VistaJet reporting improved demand this summer.

Still, many forecasters remain cautious about the business jet market with deliveries expected to decline by 25% to 30% in 2020 due to the pandemic. The industry, which delivered 809 business jets in 2019, has still not recovered since its peak of 1,317 deliveries in 2008, analyst Brian Foley said.

Honeywell’s outlook expects new aircraft deliveries to rebound to pre-pandemic levels by the middle of the decade.

Honeywell, a supplier to the aviation industry, expects business jet usage to recover to 2019 levels by the second half

By Jeremy Schwartz, CFA, Executive Vice President, Global Head of Research, WisdomTree

Last week, we had the pleasure of hosting Ed Morse, head of commodities research at Citi, on our Behind the Markets podcast to discuss his outlook for commodities.

Most commodities today have seen a lack of investment in new exploration, particularly across metals. The incremental demand, with supply constrained, pressures prices higher.

Commodities today are generally in contango, where the futures price is higher than the spot price, but Morse sees this changing to a case of backwardation, where the futures price becomes lower than the current price. This will change the environment for the monthly rolling of futures contracts, going from a cost to a net positive for investors in futures.

This was also the case for the last super cycle for commodities. We had a strong market that was in backwardation, so investors were paid to roll their contract positions forward each month, and commodities prices were going up.

The COVID-19 pandemic delayed this inflection point for roll yields from happening sooner, as it caused less demand for commodities, and transportation fuels in particular. Inventories built up significantly but are now drawing down. In Q4, the supply of oil is down 9%–10% from last year. Some of this production decline is the lack of investment and capital expenditures, particularly in the U.S.

In Q4, Morse sees demand for oil down 4%–5% year-over-year. With supply down 9%–10%, inventories will continue to draw down around five million barrels a day. This is particularly rare in September, when inventories are usually building following the driving season.

Gold’s Rise Is Not Ephemeral: Bullish moves in gold and silver tend to be longer-lasting. Morse sees gold as an inevitable and attractive macro investment in a world of low interest rates,