👚 Shein’s IPO stitch

…and Tesla reports in an icy climate   A Shein warehouse in Indiana (Scott Olson/Getty Images)   Last Week’s Market Moves   Dow Jones 37,864 (+0.72%) S&P 500 4,840 (+1.17%) Nasdaq 15,311 (+2.26%) Bitcoin $41,575 (-3.10%) Dow Jones 37,864 (+0.72%) S&P 500 4,840 (+1.17%) Nasdaq 15,311 (+2.26%) Bitcoin $41,575 (-3.10%) Hey Snackers, New job alert: dog-poop detective. An Italian city is [planning]( to use DNA tracing to track down (and fine) owners who don't scoop their pup's droppings. Classic case of poo-dunnit. On Friday the S&P 500 notched a fresh high, its first record in over two years. The milestone was fueled by a tech rally. Also: US consumer sentiment surged 13% from December to the first half of January. Btw... Do you want to start getting Snacks daily? Or prefer to unsubscribe? Manage your subscription preferences [here](. Unstitched Shein’s mega-IPO plan could unravel as scrutiny intensifies from all sides Stressin’ in a $3 tube top… First the US scrutinized Shein over its China ties; now China’s scrutinizing Shein over its US ties. Beijing’s mighty internet regulator has reportedly [launched]( a security review of the world’s top ecomm fast-fashion brand, which is gearing up for what could be one of the biggest US IPOs in years. (FYI: Beijing now requires all Chinese companies to get approval before an overseas listing.) - China’s looking for any national-security risks, including the type of Chinese data that Shein would disclose to the SEC. The review could be a good thing or a bad thing for Shein… - Worst case: The IPO is not only delayed but scrapped. China launched a similar review into DiDi soon after it listed on the NYSE, which resulted in the Chinese ride-hail giant being delisted. - Best case: It gets the green light, bringing it a step closer to a US IPO. Shein is said to be targeting up to a $90B valuation. 99 problems and an IPO is one… Shein’s estimated to have raked in $30B+ in sales last year, and most of it came from the States. But unlike American teens, US lawmakers aren’t feelin’ the #OOTD vibes. Shein’s tried to distance itself from China with plans for US distribution centers and splashy marketing, but its laundry list of issues keeps growing: - IP-theft lawsuits: Last week, fast-fashion chain Uniqlo sued Shein, alleging the biz sold knockoffs of its viral bag. (Indie designers have made similar accusations.) Rival Temu sued Shein last month, accusing it of using “mafia-style” tactics. - Labor allegations: Last year, bipartisan lawmakers urged the SEC to pause Shein’s IPO till it could prove it doesn’t use forced labor to make its clothes. THE TAKEAWAY Corporate can’t escape geopolitics… As US-China tensions simmer, Shein isn’t the only biz feeling the fallout. TikTok — which opened a US HQ as it tried to distance itself from China — is still at risk of being restricted by governments and US states (Montana already passed a ban). American companies can’t escape politics either: in China, patriotic shoppers are ditching iPhones for domestic rivals like Huawei. Apple discounted phones there after China sales plunged. Events Coming up this week An icy reception… [Tesla]( hittin’ potholes. Last quarter, Chinese carmaker [BYD]( passed Tesla as the world’s #1 EV seller. Then, versions of Tesla’s Model 3 became ineligible for US tax credits worth up to $7.5K/car. As US EV growth cools, car-rental chains [Hertz]( and Sixt have offloaded thousands of EVs (lotsa Teslas). Meanwhile, Tesla’s repeatedly cut prices (most recently in Europe). On top of all that, the Cybertruck has had mixed reviews. On Wednesday, Tesla’s expected to report higher sales but lower profit. Tap to pay… and keep paying. The holiday shopping szn was surprisingly hearty, with splurges up nearly 4% from 2022. Funding the spending spree: credit-card debt. Consumer borrowing ballooned by $23B+ in November as card balances passed a record $5T. That + high interest rates = $$ for [Visa]( and [American Express]( which are expected to report solid revenue growth this week. Despite high interest rates and debt, Americans have gained confidence in the economy and their own finances in recent months. Zoom out Stories we’re watching Better than the AI vacuum… [Apple]( topped Samsung in annual smartphone shipments for the first time since 2010. Now, the Galaxy maker and other techies are turning to AI to boost their hardware sales. Last week, Samsung intro’d a phone with AI features like real-time translation of foreign-language calls and message-editing to tones like formal, casual, and social media (lol). Unlike ChatGPT, “on-device AI'' is pre-downloaded and doesn't need internet. At CES, [Microsoft]( showed off AI PCs, and [Motorola]( and Apple could also intro AI devices. Stay seated… Investigations into [Alaska Airlines]( midair blowout have expanded. Last week the FAA finished inspections of 40 [Boeing]( 737 Max 9s (171 have been grounded) and began looking into [Spirit AeroSystems]( a Boeing subcontractor that builds plane shells. Meantime, four passengers sued Alaska and Boeing. 737 Max 9s make up 20% of Alaska’s fleet, and their grounding has led to ~150 cancellations/day. Alaska and [United]( the only US airlines that use the jet, report this week. [Delta]( delivered record annual sales, but trimmed its profit guidance for the year on higher costs. What else we're Snackin' - [TSADNA]( Airports are expanding their use of biometrics (fingerprints, face scans) in security and bag checks, replacing passports and (hopefully) speeding up lines. 30 US airports have a biometrics program rn. - [Restart]( Despite recent hits like “Zelda: Tears of the Kingdom” and “Starfield,” gaming may have a labor problem. Studios like [Amazon]( Ubisoft, and Epic laid off 6.5K workers last year, affecting a third of devs. - [Shh]( The office ain’t as chatty as it used to be. Today, noise-proof pods (picture: telephone booths) have become hot office furniture as workers scramble for places to take calls and get some privacy. Want your Snacks daily? The Daily Newsletter Get fresh takes on financial news every week day. Try a sample: ✈️ [Arriving: airline earnings]( • Jan 19, 2024 🤖 [Tech’s morale plunge]( • Jan 18, 2024 🍔 [BK’s $1B buyout]( • Jan 17, 2024 [Subscribe to the Daily]( Snack Fact Of the Day If stretched from end to end, the blood vessels in the human body would be long enough to circle the Earth twice [Read more]( This Week - Monday: Earnings expected from Logitech and United Airlines - Tuesday: Voting day for New Hampshire presidential primaries. Earnings expected from Netflix, Verizon, Johnson & Johnson, Lockheed, 3M, and GE - Wednesday: Earnings expected from AT&T, IBM, Ethan Allen, Progressive, Sallie Mae, and Tesla - Thursday: Earnings expected from Alaska Air, Blackstone, Capital One, Comcast, Humana, Intel, Levi Strauss, McCormick, Sherwin-Williams, Southwest Airlines, T-Mobile, Visa, and Xerox - Friday: Earnings expected from American Express, Norfolk Southern, and Volvo Authors of this Snacks own shares of: Alaska Air, Amazon, Apple, Comcast, Delta, Microsoft, and Tesla Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate... 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