In today’s briefing:
- Japan Weekly | Rate Cuts Ignite Rally
- Tech Giants Overhaul Platforms Amidst EU’s Digital Markets Act Enforcement [Regulations Part 2]
- Overview #9 Fallout from the Fed
- GEMWeekly (20 Sep 2024): China Macro Disappoints; Samsung, Xiaomi, Tata
- The EU Digital Services Act: Transforming Big Tech’s Operational Landscape [Regulations Part 3]
Japan Weekly | Rate Cuts Ignite Rally
- The Federal Reserve made a pivotal move last week, cutting its policy rate by 0.5%—the first rate cut in four years and larger than the typical reduction
- Japanese stocks rallied strongly this week, with the Nikkei gaining 3.1% and the Topix rising 2.8%, as the yen weakened by more than 2 yen to 143 per dollar.
- Rotation into economically sensitive areas like machinery and chemicals – KHI, Resonac, and Fujikura all out performed
Tech Giants Overhaul Platforms Amidst EU’s Digital Markets Act Enforcement [Regulations Part 2]
- Revenue Impact: Google’s ad segment may see a 5-10% drop due to stricter user data protections, reducing personalized advertising reach.
- App Store Revenue Loss: Mandated alternative payment systems threaten Google Play and Apple’s app store revenue streams, cutting commissions.
- Operational Costs: Non-compliance fines of up to 20% of annual revenue and the added costs for compliance systems intensify financial pressure.
Overview #9 Fallout from the Fed
- A review of recent events/data impacting our investment themes or outlook
- We take a look at how some of the markets we focus on reacted to the aftermath of the Federal Reserve Decision.
- China is watching key levels on the Shanghai Composite Index
GEMWeekly (20 Sep 2024): China Macro Disappoints; Samsung, Xiaomi, Tata
- The Global Emerging Markets Weekly summarises the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.
- Macro data points: Chinese industrial production, retail sales, and fixed asset investment data.
- Companies mentioned:Samsung Electronics (005930 KS), Xiaomi Corp (1810 HK), Tata Group (1396Z IN)
The EU Digital Services Act: Transforming Big Tech’s Operational Landscape [Regulations Part 3]
- Meta’s ongoing compliance with the DSA has escalated expenses, requiring a dedicated team of over 1,000 and an annual content moderation budget exceeding $5 billion.
- The DSA imposes restrictions on targeted advertising, crucial to Google’s revenue, necessitating shifts toward less invasive methods, increasing operational complexity and long-term financial risk.
- Compliance with the DSA and DMA could undermine Apple’s closed ecosystem, forcing it to allow third-party app stores, jeopardizing its revenue from App Store commissions.
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