September 5, 2023
Tesla’s China Sales Rise 9.3% in August, Profit Slumps
📰 News Organizations
Tesla’s China Sales Rise 9.3% in August. The price cuts are working. Tesla sold 84,159 China-made EVs in August, a 9.3% rise from a year earlier. But with sales being prioritized, Tesla's profit margin has taken a hit. Its gross margin from automotive sales plunged to 17.9%.
Global Indexes Rise on China’s Property Stimulus Measures. International stock markets rose, led by Chinese indexes, after Beijing rolled out further support measures for its property sector. U.S. stock-index futures edged higher, with U.S. markets closed for the Labor Day holiday.
Novo Nordisk’s Wegovy Weight Loss Drug Launches in the UK. Novo Nordisk advanced the drug’s rollout in Europe despite ongoing supply constraints. Surging demand for the weight loss drug has shot the company’s shares to record highs.
Albemarle Raises Bid for Australia’s Liontown Resources to $4.25 Billion. The deal would be one of the largest in the lithium-mining industry. Lithium has become one of the hottest commodities in global mining as governments push to electrify their economies.
Mercedes Bets on Range Boost in Swipe at Tesla’s EV Lead. Mercedes-Benz Group AG unveiled an electric vehicle with a longer range than any Tesla Inc. model on the market as the German luxury car maker intensifies its bid to challenge Elon Musk.
Barclays Plots Selling a Stake in UK Merchant Payments Unit. As part of efforts to boost its lagging share price, the bank has reached out to potential partners and worked internally on the plan. Selling a stake could value the whole unit at as much as $3.8 billion.
The strength of energy stocks continues to suggest that oil prices are likely to face further upward pressure due to persistently tight supply conditions. Energy equities are approaching new recent highs, WTI prices have a 45% of appreciation potential still ahead. Source.
Solar deployment is now happening at a roughly $500B annualized rate. The US's aircraft production during WWII seems to have peaked at maybe $400B (inflation-adjusted). Global data center construction appears to be maybe $200B/year. Source.
Without a substantial further moderation in these wage pressures, it is unlikely the underlying structural inflation in the economy will be resolved which creates risks of a reacceleration, particularly if another inflationary impulse emerges. Source.
August global manufacturing PMI was up six-tenths to 48.2, yet remains below the 50 threshold for 1 year, still suggesting a global slowdown. The rebound was driven by rising short-term price pressures from very low levels while activity components were marginally up. Source.
Is this the set-up for emerging markets? The MSCI Emerging Markets index has a dividend yield of 3.10%, or about double the 1.49% yield on the S&P 500. The gap between the two is wider than at any time in the pre-Covid era, 1994-2020. Source.
📓 Online Publications
Lumber Prices Down 14% YoY. Unfortunately, this impacts long-term price comparisons since the new contract was priced about 24% higher than the old random-length contract for the period both contracts were available.
Dollar Cost Averaging in a Bear Market Wins Again. From the start of 2022 through July 2023, the S&P 500 was down 1.2% in total. But dollar cost averaging each month over that same time frame would have given you an internal rate of return of more than 13%. IRR was nearly 9%.
Investors Seem to be Losing Hope on Paypal. Stock fell 18% in August, according to S&P Global Market Intelligence. Investors continue to be disappointed in the digital payments giant's direction after an uninspiring earnings report, and the announcement of a new CEO didn't do too much.
Economists Grow Gloomier On 2024 As Central Banks Delay Rate Cuts. New forecasts find that growth is expected to slow next year and economists predict that high demand will keep inflation elevated for longer. Growth in the US is expected to only reach 0.6 percent next year. Source(1:20)
Secret Paper Trail Reveals Hidden Adani Investors. Investors sold off shares in Indian industrial conglomerate Adani after the FT published an investigation into the company last week. That story revealed two of the largest shareholders who were linked to the Adani family. Source(1:51)
Americans Are Spending More On Experiences Than Ever Before. This summer saw a significant economic boost driven by cultural icons like Taylor Swift and Barbie, with concerts and movies contributing billions to the economy. Social media virality and a surge in travel further fueled this economic upswing. Source(3:25)