Apple has been ousted from the top five smartphone vendors in China during Q2, as local brands like Huawei continue to escalate competition
Apple is no longer among the top five smartphone vendors in China as local brands take over the market.
Apple’s market share in China has declined, falling to 14% in the second quarter from 15% in the first quarter and 16% 2023.
For the first time in history, domestic vendors have taken over all top five positions in China.
According to reports, incorporating Apple’s Intelligence systems in its products in mainland China will be crucial over the next 12 months, as Chinese brands are rapidly integrating generative AI into their designs.
This is not good news for Apple. The company is facing challenges, notably lagging behind in the AI innovation race, and compounded by a rapidly falling share of the mobile market in China.
The personal consumption expenditures price index (PCE) increased 0.1% in June 2024 and was up 2.5% from a year ago, with the annual rate showing a slight decline from the prior month
Core inflation, which excludes food and energy, showed a monthly increase of 0.2% and 2.6% on the year, both also in line with expectations.
Personal income rose just 0.2%, below the 0.4% estimate. Spending increased 0.3%, meeting the forecast, while the personal savings rate decreased to 3.4%.
This PCE reading may encourage the Fed to cut rates now.
OpenAI on Thursday 25th July 2024 announced a prototype of its search engine, called SearchGPT, which aims to give users “fast and timely answers with clear and relevant sources.”
The company has announced plans to eventually incorporate the tool, presently in testing with a select user group, into its ChatGPT chatbot.
The introduction of ChatGPT could have significant implications for Google’s search engine dominance. Since ChatGPT’s debut in November 2022, there has been growing concern among Alphabet’s investors that OpenAI may capture a portion of Google’s market share by offering consumers innovative methods to obtain information on the internet.
Alphabet three month share price as of 25th July 2024
Alphabet three month share price as of 25th July 2024
OpenAI’s ChatGPT was incorporated into Microsoft’s search engine Bing as Copilot and the companies have kept market dominance with this shrewd AI move. Google, on the other hand, has struggled to keep up in the AI race and may now be suffering the effects.
This announcement could have implications for Microsoft’s Copilot as well.
In the second quarter of 2024, the U.S. economy expanded at a strong annual rate of 2.8%, exceeding economists’ forecasts.
This surge was fueled by positive consumer spending, substantial government expenditures, and increased inventories.
The personal consumption expenditures price index saw a 2.6% rise in the same timeframe, a decrease from the prior quarter’s 3.4% climb as core prices, which exclude food and energy, increased by 2.9%.
The data suggests a continued deceleration in the personal savings rate, standing at 3.5% for the quarter, down from 3.8% in the first quarter.
Kering, the owner of Gucci, experienced a drop in its share value on Thursday 25th July 2024 following the announcement of a significant revenue decrease in the first half of the year, coupled with a subdued outlook for the latter half.
Kering’s shares fell by up to 9% as the markets opened, trading at levels not seen since August 2017.
Kering one year share price chart 24th July 2024 (am)
Kering one year share price chart 24th July 2024 (am)
The luxury group announced late Wednesday 24th July 2024 that its revenue dropped by 11% in the first half of 2024, in comparison to the same period the previous year. The company reportedly attributed the decline to a slowing market in most regions, with the exception of Japan.
Kering are not alone in suffering a drop in share value, as luxury brands including LVMH and Burberry also experienced weaker trade declines noted in recent reports.
A deceleration of luxury purchases in China is cited as one of the major reasons for the declines.
Stocks sold off Wednesday 24th July 2024, blighted by underwhelming reports from Tesla and Alphabet – leading the Nasdaq Composite and the S&P 500 to post their worst sessions since 2022.
The S&P 500 index dropped to closing at 5427, while the tech-heavy Nasdaq slid around 3.65% to end at 17342. The Dow Jones Industrial Average shed 504 points closing at 39853.
Nasdaq Comp one day chart 24th July 2024
Nasdaq Comp one day chart 24th July 2024
Shares of Google parent company Alphabet fell 5% for their biggest one-day drop since 31st January, when they dropped 7.5%. Although Alphabet reported good numbers, YouTube advertising revenue came in below the consensus estimate causing share to dip.
Alphabet one day chart 24th July 2024
Tesla shares declined around 12% – their worst day since 2020 – on weaker-than-expected results and a 7% year-on-year drop in auto revenue.
Shares in LVMH fell on Wednesday after the luxury group on Tuesday 23rd July 2024 released its earnings for the first half of 2024
Shares in the world’s largest luxury group LVMH pulled-back on Wednesday 24th July 2024 after its second-quarter sales came in below analysts expectations
Other luxury sector stocks, including Gucci-owner Kering which is set to report earnings on Wednesday 24th July, also retreated.
Tesla’s shares dropped in U.S. pre-market trading following the electric car maker’s Q2 earnings report, which fell short of expectations.
The company saw a 7% year-on-year decrease in automotive revenue for the June 2024 quarter, down to $19.9 billion, and a decline in its ‘adjusted’ earnings margin.
Investors are divided on Tesla’s stock, with some concerned that the core car business is struggling, while others remain optimistic about Musk’s vision for autonomous driving.
Tesla continues to lead in U.S. electric vehicle sales, yet it’s facing declining market share as competitors emerge, partly due to its older range on offer and Elon Musk’s occasional controversial public statements.
Attention has shifted to other aspects of Tesla’s narrative, such as the anticipated introduction of a new mass-market vehicle to refresh its vehicle lineup. Musk reportedly re-affirmed that Tesla plans to launch an ‘affordable’ car in the upcoming year.
Tesla 3-year share price chart as at: 23rd July 2024
Tesla 3 year share price chart as at: 23rd July 2024
The earnings also highlighted his robotaxi vision. Musk shared his ‘expectation’ of a future where Tesla owners could allow their vehicles to operate in an Uber-like ride-hailing environment, with the cars driving autonomously.
And then we have the prospect for the greatly hyped arrival of Tesla’s humanoid robot due in 2025.
Bitcoin is often likened to a type of digital gold, but Ether is seen more as a native cryptocurrency on the Ethereum blockchain.
It is generally seen as a trade or bet on the growth and of the development of the blockchain and of crypto more widely.
Many of the funds set to launch this week have temporarily waived fees in an attempt to attract buyers.
The Securities and Exchange Commission (SEC) has historically been wary of cryptocurrencies. However, the regulator was defeated in a legal battle last year concerning Bitcoin ETFs, which aided their launch in January 2024.
Given that both Bitcoin and Ether have regulated futures markets, the introduction of ether ETFs was viewed as the industry’s subsequent rational progression.
Bitcoin ETFs have attracted about $17 billion in net inflows since their launch in January 2024.
What is An Ethereum ETF?
An Ethereum ETF, or Ether ETF, is an exchange-traded fund that tracks the price of ether (ETH), the cryptocurrency with the second-highest market capitalization following Bitcoin. Unlike purchasing Ethereum on a cryptocurrency exchange, an Ethereum ETF is bought and sold on traditional stock exchanges.
How an Ethereum ETF works
An Ethereum ETF contains futures contracts linked to Ethereum’s price movements. These contracts enable investors to speculate on Ethereum’s future price without the need to own the cryptocurrency directly.
Investing in an Ethereum ETF offers exposure to Ethereum’s price volatility while eliminating the need to handle wallets or navigate the intricacies of cryptocurrency exchanges. Such ETFs offer traditional investors a practical avenue to engage with the cryptocurrency market, leveraging the conventional environment of stock exchanges.
Ethereum one year price chart as at: 16:10 BST 23rd July 2024 from CoinMarketCAP
Ethereum one year price chart as at: 16:10 BST 23rd July 2024 from CoinMarketCAP
Tesla boss Elon Musk says the electric car maker will start producing and using humanoid robots from next year.
In a social media update, Elon Musk stated that Tesla will initially employ the robots, with plans to commence production for sale by 2026.
He had earlier anticipated that the robot, named Optimus, would be operational in Tesla factories by this year’s end. Additionally, companies such as Honda Rototics and Boston Dynamics are also advancing their humanoid robot technologies.
“Tesla will have genuinely useful humanoid robots in low production for Tesla internal use next year and, hopefully, high production for other companies in 2026,” Mr Musk posted on his social media platform X.
Wiz has apparently walked away from a deal with Google that would have valued the company at $23 billion.
The deal would have nearly doubled the $12 billion valuation of the startup from its most recent round of funding.
CEO of WIZ Assaf Rappaport told employees the company would pursue an IPO as originally planned.
Wiz was founded in 2020 and has grown rapidly. The company had been targeting an IPO as recently as May 2024. The business hit $100 million in annual recurring revenue after 18 months and reached $350 million last year.
Wiz’s cloud security products offer prevention, active detection and response, a portfolio that’s appealed to large firms and would have helped Google compete with Microsoft, which also sells security software.
Highest ratio since the 1960’s and even higher than that reached during the Covid pandemic of 2020.
The UK’s national debt has reached its highest level since 1962.
Official figures from the ONS show that the total government debt amounted to 99.5% of the economy’s value in June 2024, surpassing the peak levels experienced during the coronavirus pandemic.
The current debt level is comparable to that last observed in the early 1960’s.
CrowdStrike’s shares fell a further 13% on Monday 22nd July 2024 while the cybersecurity software firm attempted to help clients from various sectors to recover from an outage that disrupted millions of Microsoft Windows devices on Friday 19th July 2024.
CrowdStrike 5-day share price chart
Early Friday, the company released a flawed update to its Falcon vulnerability-protection software, leading to crashes in PC’s, data centre servers, and networked display screens.
IT staff swiftly acted to repair computers. At the same time, hackers attempted to exploit the turmoil by creating malicious websites that seemed to provide software updates.
Chief security officer Shawn Henry said the incident had been a “gut punch” for the firm, which had previously been one of the most trusted names in the industry.
“We let down the very people we committed to protect, and to say we’re devastated is a huge understatement,“ he reportedly said.
Mr Henry, a former FBI executive assistant director, reportedly said the weekend had been “the most challenging 48 hours” of his 12 years at the company. He promised it would use the incident as an opportunity to “emerge better and stronger than ever”.
“The confidence we built in drips over the years was lost in buckets within hours, and it was a gut punch,” he said in a LinkedIn post, on Monday 22nd July 2024.
“But this pales in comparison to the pain we’ve caused our customers and our partners.”
The fascinating tale of Pepsi’s unexpected naval acquisition dates back to the late 1950’s.
In 1959, during the Cold War, the United States and the Soviet Union were engaged in an ideological battle – communism vs capitalism.
In that time, the U.S.S.R. held an exhibition in New York to demonstrate its cultural and technological progress. In response, the United States established the American National Exhibition in Moscow, which featured various American products, including the famous carbonated beverage, Pepsi-Cola
The kitchen exhibition
In July 1959, then-Vice President Nixon and Soviet Premier Khrushchev engaged in a lively debate at the American National Exhibition. Set against the backdrop of a model American kitchen, they argued over the merits of capitalism versus communism. The exhibition also showcased a Pepsi-Cola booth, symbolizing the beverage’s American and Russian variants.
Pepsi for Khrushchev
Donald M. Kendall, an executive at Pepsi, embarked on a mission to have Khrushchev hold a Pepsi. On the exhibition’s eve, Kendall made a bold promise to Nixon. He aimed to showcase the trip’s significance, culminating in the staged moment where Khrushchev tentatively sipped Pepsi. This pivotal event was captured in a photograph, acquainting numerous Russians with the fizzy beverage for the first time.
The deal
The Soviet Union had a long-established tradition of exchanging vodka for Pepsi concentrate. However, the arrangement took an extraordinary turn when Pepsi served as an intermediary in a remarkable swap: the Soviets offered a fleet of 17 submarines, a cruiser, a frigate, and a destroyer – estimated to be worth around $3 billion – as compensation for their pending Pepsi delivery. This deal briefly made Pepsi the possessor of the world’s sixth-largest naval force.
Pepsi’s fleet
The company eventually sold the warships for scrap, but for a brief period, they boasted an impressive naval fleet.
This event marks a unique chapter in the history of both the beverage industry and naval affairs, where the worlds of carbonated drinks and military warships intersected.
CrowdStrike issue causes major outage affecting thousands of businesses around the world
The irony
It has been widely reported that an ‘update‘ by ‘cybersecurity‘ firm CrowdStrike led to a major IT outage on Friday 19th July 2024, impacting businesses around the world. Microsoft systems have been badly affected.
CrowdStrike statement
“The issue has been identified, isolated and a fix has been deployed,” CEO George Kurtz said in a statement on X. But not before untold havoc was caused across the globe.
Blue screen of death
The comments came after widespread reports of technical issues, with many Microsoft users around the world facing an error screen known as the ‘blue screen of death.’
Biggest IT fail ever – Elon Musk
Elon Musk on X called it the ‘Biggest IT fail ever’.
Problems
Reports flooded in all day from around the world of systems and businesses impacted by the issue.
Without going into individual failings, here are some of the areas impacted by this problem.
NHS and GP practices in the UK, airport delays, flight cancellations, SKY TV off air, Microsoft system failures, VISA issues, Sainsbury’s and Morrissons supermarket card payments down, banks hit, Lloyds, Tesco, airlines in U.S., Germany, Canada, Italy, India and around the globe. UK Rail payment systems down and trains cancelled, New York Metro train issues, schools, betting firms hit, finance, pharmacies, payrolls and even the Paris Olympic system too.
Interconnected frailty
I think you get the picture. This is by no means an exhaustive list – but it aptly demonstrates the severity of this failed system update and how interconnected our world has become.
Crowdstrike says global IT issues caused by ‘defect’ in ‘content update’
Here’s the full statement from George Kurtz, the CEO of Crowdstrike
“Crowdstrike is actively working with customers impacted by a defect found in a single content update for Windows hosts.
“Mac and Linux hosts are not impacted. This is not a security incident or cyberattack.
“The issue has been identified, isolated and a fix has been deployed.
“We refer customers to the support portal for the latest updates and will continue to provide complete and continuous updates on our website.
“We further recommend organisations ensure they’re communicating with Crowdstrike representatives through official channels.
“Our team is fully mobilised to ensure the security and stability of Crowdstrike customers.”
Who and what is Crowdstrike?
CrowdStrike is a cybersecurity firm established in 2011, dedicated to protecting major corporations and their hardware from cyber threats and vulnerabilities.
The company specializes in endpoint security, striving to block malicious software and files from compromising corporate networks via connecting devices like phones and laptops.
Additionally, CrowdStrike focuses on securing the data of businesses that have transitioned from hosting it on-premises to utilizing cloud-based services.
Should we worry?
As our world becomes over interconnected and closely Intergrated, should we be concerned about a handful of powerful companies dictating the tech world we live in?
I believe we should be concerned. This was just a routine upgrade and the company let us down.
I used to run my own IT business and upgrades and system improvements were a big part of my then tech life, so I have a pretty good understanding of these issues, especially performing a system upgrade.
Preparation is key. Sometimes things go wrong – the unforeseen. But you must quickly overcome the problem with a ‘backup’ contingency plan.
Others are depending on YOU!
My mantra then and it is still the same now: BACKUP! BACKUP! BACKUP!
You have to get these this right – but CrowdStrike didn’t!
On Wednesday 17th July 2024, the Nasdaq Composite and S&P 500 pulled-back as investors continued to shift from tech stocks to more interest rate-sensitive sectors.
The S&P 500 dropped 1.39%, closing at 5588. The tech-geared Nasdaq tumbled 2.77%, finishing at 17996, marking its worst session since December 2022 and ending below 18000 for the first time since 1st July 2024.
Conversely, the Dow Jones Industrial Average resisted the downward trend, gaining around 243 points, or to close at 41198. This advance led the index to close above the 41000 milestone.
The pound reached its highest level against the dollar in a year on Wednesday 17th July 2024, as investors wagered that UK interest rates would remain elevated for longer.
New data released on Wednesday 17th July 2024 indicated that inflation was more persistent than some analysts had anticipated, leading traders to reduce their expectations of a rate decrease in August 2024, propelling the pound above $1.30 for the first time since the previous July.
Additionally, the pound’s strength has been supported by market optimism that the newly elected Labour government will provide economic stability.
U.K. inflation matched the Bank of England’s target of 2% in June 2024, as calculated by data from the Official for National Statistics on Wednesday 17th July 2024.
The main figure was slightly higher than the 1.9% forecast by analysts surveyed by Reuters, aligning with May’s 2% figure.
Following the announcement, the value of Sterling increased modestly, reaching $1.2977 at 7:21 a.m. British Summer Time.
The Bank of England (BoE) closely monitors services inflation due to its significant role in the U.K. economy and as an indicator of domestic price increases, which remained at 5.7% in June. Service inflation remains a stubborn issue and a problem still for the BoE.
The core inflation rate, which excludes energy, food, alcohol, and tobacco, stood at 3.5%, consistent with the rate seen in May 2024.
The Dow Jones Industrial Average closed at a record high Tuesday 16th July 2024, rallying 743 points for its biggest one-day increase in more than a year, as the bull run appeared to broaden.
The small cap-focused Russell 2000 also rose for the fifth straight day, rising 3.5% fast closing in on a new record high as the money continues to rotate from tech stocks.
Russell 2000 index one year chart
The Dow Jones finished at 40,954, marking an increase of 1.85% for the day. It has experienced consistent daily gains since the previous week, culminating in an overall rise of over 4% over the past five trading days. The closing value on Tuesday 16th July 2024 represents the largest single-day gain since June 2023.
Dow one year chart as at: 16th July 2024
The market saw an uptick amidst a broader rally, driven by the news that June retail sales exceeded expectations, strong earnings reports to date, and the expectation of a benchmark interest rate reduction by the Federal Reserve in September.
Positive remarks from the Federal Reserve about potential interest rate cuts are bolstering market sentiment. Additionally, the buzz surrounding Trump’s re-election campaign and the recent assassination attempt on Trump at one of his election rallies seem to be influencing market movements as well.
However, Donald Trump reportedly said Taiwan should pay the U.S. for defence, in an interview with Bloomberg Businessweek published on Tuesday 16th July 2024. His comment had a negative impact on chip and tech stocks.
Crypto is enjoying the market rotation as more money is being ploughed back into cryptocurrencies. Bitcoin jumped from a low point in July 2024 of just below $56,000. Altcoins are also enjoying a mini-recovery.
Bitcoin benefitting from markets rotation – one year chart
Gold prices climbed to $2,482 per ounce, hitting an all-time high.
Gold prices continued to peak at new record highs Tuesday and Wednesday 15th and 16th July 2024.
On Monday 15th July 2024, Powell reportedly said the Fed won’t wait for inflation to reach the central bank’s 2% target before it begins cutting, due to the ‘lag’ in policy effects. He reportedly said the Fed is looking for ‘greater confidence’ that inflation will return to the 2% level. The monthly inflation rate dipped in June 2024 – the first time in over four years.
The price increase has been aided by encouraging comments from the Federal Reserve that it will now more likely cut interest rates in September 2024 following comments from Fed Chair Jerome Powell.
And that has given market investors and traders more confidence. According to the CME FedWatch tool, traders are convinced the FOMC will cut rates by September 2024.
As interest rates fall, gold usually becomes more appealing compared to fixed-income assets such as bonds and general savings accounts.
Jerome Powell appears to be further paving the way for a rate cut at the next meeting in July 2024.
Federal Reserve Chair Jerome Powell reportedly said Monday 15th July 2024 that the central bank will not wait until inflation hits 2% to cut interest rates.
Powell referenced the idea that central bank policy works with ‘long and variable lags’ to explain why the Fed wouldn’t wait for its target to be hit.
‘The implication of that is that if you wait until inflation gets all the way down to 2%, you’ve probably waited too long, because the tightening that you’re doing, or the level of tightness that you have, is still having effects which will probably drive inflation below 2%,’ Powell reportedly said.
Instead, the Fed is looking for ‘greater confidence’ that inflation will return to the 2% level, Powell remarked.
‘What increases that confidence in that is more good inflation data, and lately here we have been getting some of that,’ he reportedly said.
Powell also said he thinks a ‘hard landing’ for the U.S. economy was not ‘a likely scenario.’
It looks like it is time for that rate cut, he didn’t say that!
Burberry shares slide on Monday 15th July 2024 after the UK luxury fashion group announced a profit warning and a dividend halt and said its chief executive officer (CEO) was being replaced.
The maker of the iconic trench coat described a ‘disappointing’ fiscal first-quarter 2025 in a trading update.
Burberry reportedly said that if the recent trading slowdown continues, it expects to report an operating loss for the first half of this year and full-year operating profit below current consensus.
Shares in the 168-year-old British luxury giant were down 15% on Monday 15th July 2024 in early London trading.
Burberry share price falls to around 745 on Monday 15th July 2024 – one year share price chart
Burberry share price falls to around 745 on Monday 15th July 2024 – one year share price chart
The Dow Jones Industrial Average surged on Friday 12th July 2024 as investors began to diversify beyond the technology sector.
The Dow closed at 40,000.90, after hitting a new all-time high of 40,257.
The Dow closed at 40,000.90, after hitting a new all-time high of 40,257.
The S&P 500 added 0.55% to 5,615, and the Nasdaq Composite went up 0.63% to 18,398. However, on Thursday 11th July 2024 the S&P 500 experienced its worst day since late April due to a major market rotation, with Nvidia dropping 5.6%.
Investors rotated from tech to industrial stocks in the Dow on Friday, hoping that slowing inflation might lead to a Federal Reserve rate cut in September.
The Dow gained 1.6% for the week, spurred by a report showing a 0.1% decline in the consumer price index for June. Recent reports suggest that the Federal Reserve might indeed consider a rate cut in September if inflation continues to slow.
While the AI growth has been dominant, other market catalysts, such as potential rate cuts, can also drive different sectors, including utilities.
Good earnings, improving economic news and the promise of a rate cut are combining to become the perfect storm for U.S. stocks.
U.S., UK and Germany hold more Bitcoin than you may think.
According to the Arkham website, the United States’ government holds some 212,847 BTC making it one of the biggest holders of Bitcoin, while the treasuries of the U.K. and Germany reportedly hold around 61,245 BTC and 49,858 BTC each. (These values alter daily).
In addition to Bitcoin, the U.S. government also holds around $200 million in other cryptocurrencies like Ether (ETH), as well as major stablecoins like USDC.
U.S. Bitcoin holding by current value according to Arkham
Arkham, a crypto intelligence platform focused on deanonymizing entities on the blockchain network, has introduced a dashboard featuring the governments with the largest crypto holdings.
The U.K. government, reportedly ranked second, holds around $3.5 billion worth of Bitcoin at current valuations, according to Arkham’s data. The German government owns roughly $2.5 billion.
UK Bitcoin holding by current value according to Arkham
In June 2024, China’s imports fell by 2.3% year-on-year in U.S. dollar terms, missing the expected 2.8% growth forecast by analysts.
However, exports rose by 8.6%, surpassing the anticipated 8% growth. This resulted in a 2% increase in year-to-date imports and a 3.6% rise in exports for the first half of the year compared to the same period last year.
Additionally, China’s trade with the Association of Southeast Asian Nations (ASEAN) surged by 7.1% in the first half of the year, solidifying ASEAN as China’s largest regional trading partner, followed by the European Union.
Trade with Brazil grew rapidly in the first half of the year, with Chinese exports to the country surging by 24.4%.
