Daily Brief - 16 Apr 2024

China’s GDP jumps 5.3% in first quarter

China's economy has had a strong start this year, growing by 5.3% in the first quarter, surpassing expectations. High-tech manufacturing, especially in areas like 3D printing and electric vehicle charging stations, has driven this growth.

However, concerns remain as the property market continues to struggle, and household spending is low. The government has cut interest rates and increased spending to try and meet its ambitious annual growth target of around 5%.

Despite the upbeat manufacturing sector, broader challenges persist, particularly with the international community's growing concern over market flooding.

iPhone sales dip opening up the top position in the market

Apple's iPhone sales dropped by 10% last quarter, opening up the top position in the global smartphone market. Despite an overall increase in smartphone shipments, Apple saw its market share decrease from 21% to 17%. This shift allowed Samsung to regain the lead, even with stagnant sales, while Xiaomi also grew its share to 14%. This downturn in iPhone sales comes amidst increasing competition in China, where local brands are gaining traction partly due to government restrictions on foreign devices. Albeit these challenges, Apple's stock has shown some resilience, with hopes pinned on upcoming developments in AI technology and new products expected later in the year.

Dow Jones rises on strong financials, yet treasury yields add pressure

The Dow Jones Industrial Average saw significant gains recently, fueled by impressive earnings from major financial corporations like Goldman Sachs.

Goldman Sachs' shares jumped 3.1% following a standout performance in bond trading and underwriting, marking its best earnings since 2021. M&T Bank also surged by 5.1% due to a positive financial outlook. The surge in bond yields, sparked by robust retail sales data, is putting pressure on rate-sensitive sectors, leading to losses in real estate and utilities.

Market dynamics remain complex, with the Federal Reserve's potential policy shifts adding further uncertainty. Investors are encouraged to stay cautious and strategic, especially those in rate-sensitive industries, a backdrop of persistent global challenges.