👛 Chinese consumers cut back

Chinese demand for luxury goods falters, the UK economy is on the up, and a hydrogen-powered air taxi | [Finimize](   TOGETHER WITH     Hi {NAME}, here's what you need to know for July 25th in 3:09 minutes.   😎 Sometimes more really is... just more. So join us for [Make More Out Of Your Portfolio With US-listed Options]( at 5pm on Aug 15th to learn about diving into the options market. [Grab your free ticket]( Today's big stories - Chinese consumers kept their wallets closed, leading to a dismal time for European firms - Why share prices have started to shrink for the world’s big obesity drugmakers – [Read Now]( - Business activity in Britain showed it’s making a comeback, and investors have been taking notice Sober Season [Sober Season] What’s going on here? European companies have been [striking]( a gloomy tone this earnings season, with Chinese consumers keeping their hands in their pockets. What does this mean? China’s economic slowdown doesn’t stop at the country’s borders: Europe is definitely feeling more sluggish as its top trading partner struggles. The region’s beloved luxury brands are selling fewer handbags, belts, and silks. Luxury parent LVMH – whose high-end babies include Louis Vuitton and Veuve Clicquot – made 14% less in sales in the second quarter as cautious consumers tightened their fancy purse strings. All of that’s a blow to profits, share prices, company valuations, and even jobs. Why should I care? Zooming out: Like a rolling stone. Chinese authorities aren’t holding back: just this week, they slashed interest rates in hopes of giving the economy a boost. But critics say to get things rolling again, the government will need to flash its cash with some major stimulus. In the meantime, folks everywhere are feeling the pinch. Entire countries are bracing themselves, including Germany: the country’s goods make up half of the bloc’s China-bound exports. Individual companies are preparing for the worst too: Volkswagen, Standard Chartered Bank, and mining companies BHP Group and Rio Tinto rake in almost half their revenue from China. It seems no one’s safe, really, with Chinese firms looking to shift their dusty inventories to the West where there’s more demand – creating a problem for global manufacturers. The bigger picture: There’s always a but. Bucking the trend, though, are four of the world’s biggest chip equipment makers, which have seen their Chinese revenues take off since late 2022. But that gravy train won’t run forever, especially with the US harping on about even tighter regulations that could cut sales of advanced tech to China. So it seems that riding on China’s coattails and relying on its demand might truly be a thing of the past. You might also like: [Morgan Stanley wants you to understand where firms really make their money.]( Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=Sober Season&utm_campaign=daily-global-25-07-2024&utm_source=email) Analyst Take The Yo-Yo Stock Gains And Losses Of Novo Nordisk and Eli Lilly [The Yo-Yo Stock Gains And Losses Of Novo Nordisk and Eli Lilly]( By Russell Burns, Analyst Eli Lilly and Novo Nordisk cut a striking figure – the two [pharma giants]( at the leading edge of the obesity-drug frenzy. The wild popularity of their pounds-slimming treatments has sparked an eye-popping [stock]( rally and placed the pair among the world’s sexiest companies. But, last week, like so many of the market’s winners, they saw their share prices [plunge](. That’s today’s Insight: [why share prices have started to shrink for the firms that launched the obesity-drug frenzy](. [Read or listen to the Insight here]( Bulls have horns for a reason Change might scare some of us – but it excites plenty, too. Case in point: when financial markets start moving as quickly as they are today, many investors take the opportunity to go against the grain or seek quick turnaround trades. That’s where [leveraged and inverse ETFs]( come in. The first lets traders amplify their high-conviction trades, while the latter lets traders bet on price dips without having to “short” assets. That means you could put a bigger bet on a market move or technical signal without accessing more capital. So if you’re a risk-tolerant trader, you’ll want to [find out how to use them safely and effectively](. Our free guide with Direxion – a platform that specializes in tools for decisive investors – has the lowdown: [discover how you could use leveraged and inverse ETFs to amplify your trades](. [Read The Guide]( See Direxion's disclaimers in their guide[here](. Umbrellas Away [Umbrellas Away] What’s going on here? British business activity is [starting]( to look downright sunny, with growing optimism about the country’s economic and political outlook. What does this mean? The UK’s official purchasing managers’ index checks the overall climate for private sector companies. And the latest look shows them shining: confidence is up, they’re hiring, and manufacturers are fielding new orders left, right, and center. The index rose to 52.7 in July – comfortably above the critical 50 level that separates the economic good times from the bad. That’s thanks to a little pickup in the services sector and a hefty improvement in manufacturing. And there were handshakes aplenty: new business increased and new jobs were started at their healthiest pace in over a year. Why should I care? For markets: Cheap as chips. UK stocks have been stuck in a bit of a rut since 2016’s Brexit vote. But near-target inflation and some new political leadership have investors giving the country’s shares a second look. Big investing houses have been crowding into London’s mid-sized stocks like they’re the Tardis. But, after years of underperforming, they’re still pretty cheap – and so are Britain’s bigger fish investments. Of course, that could soon begin to change: attractive valuations and an economic recovery make for a pretty tasty recipe. The bigger picture: Lessons from China. With inflation seemingly back under control and interest rates expected to be slashed across most major economies this year, that should paint a brighter picture for global growth and stocks. But with geopolitical tensions, election uncertainties, and a still-struggling Chinese economy, it won’t all be sunshine and shortbread. In fact, if there’s one lesson to take from China now, it’s that low valuations aren’t everything. The country’s stocks are still trading super-cheap compared to other major markets – but with the outlook still so murky, even bargain hunters are keeping their distance. You might also like: [The UK might not be a value trap anymore](. Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=Umbrellas Away&utm_campaign=daily-global-25-07-2024&utm_source=email) 💬 Quote of the day "Only the dreamer shall understand realities, though in truth his dreaming must be not out of proportion to his waking." – Margaret Fuller (an American journalist and editor) [Tweet this]( Take a seat on the summit’s main stage Thousands of retail investors tuned into our [Modern Investor Summit]( sessions last year. Eager to discover the smartest tools and savviest tricks, they piled into fireside sessions, Q&A panels, and keynote speaker slots with the likes of Jamie Dimon. Now’s your chance to secure a spot at the next one. Our [Summit]( is slated for December this year, and we’re on the lookout for speakers with big ideas and serious know-how. 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