IPO Highlights, Telecom Opportunities, and AI Legal Battles

WeRide's Major IPO, Rogers' Investment Potential, TikTok's Legal Fight, and More

WeRide Files for Biggest US IPO by Chinese Firm Since Didi - Bloomberg

• Chinese autonomous technology startup WeRide Inc. has filed for an IPO in the US, potentially the biggest listing by a Chinese company in the country since Didi Global Inc.'s 2021 debacle. The company may face legal and operational risks due to its operations primarily in mainland China. The proposed price range for its American depositary shares has not been disclosed yet. Renault-Nissan-Mitsubishi Alliance has agreed to buy shares in the IPO in a private placement.

Rogers Rout a ‘Great Time to Buy’ as Price War Eases, TD Says - Bloomberg

• Rogers Communications Inc. shares are down 19% from January highs, but one telecom analyst suggests it may be a good time to buy as Canadian wireless carriers are hiking prices.

• TD Securities analyst Vince Valentini expects Rogers to follow suit and sees potential for meaningful upside in the near-term due to the Bank of Canada’s recent rate cuts and increased confidence in wireless and cable/wireline revenue growth.

TikTok’s Survival Is at Stake in All-Out Fight Against US Ban - Bloomberg

• TikTok is battling a potential US ban with lawyers, lobbyists, and money to fend off a new law barring the app unless its parent company, ByteDance Ltd., divests.

• The company has deployed Washington power brokers and $1,500-an-hour attorneys to fight the legislation, arguing that the app is a national security threat due to its data collection and ties to the Chinese government.

• A ban would exclude TikTok from the world’s most lucrative advertising market and give an immediate boost to rivals like Meta Platforms Inc. and YouTube’s Shorts. The government’s response is due Friday ahead of oral arguments in September, and TikTok has argued that the law is unconstitutional and will take its case to the Supreme Court. The app has shelled out over $4.8 million for ads promoting stories about how the app improved users’ lives, according to ad analytics company AdImpact.

Elon Musk’s X Gives Users Chance to Keep Posts From AI Chatbot - Bloomberg

• X users can control whether their public posts are used to train the AI chatbot Grok.

• Users can also make their accounts private to prevent data from being ingested by the chatbot.

Nubank Dangles 13% Interest Rate to Lure Customers in Colombia - Bloomberg

• Digital bank Nu Holdings Ltd. is offering a 13% interest-rate savings account in Colombia, attracting 600,000 new clients. The Colombian unit of the Brazil-based Nubank has drawn 900 billion pesos in deposits between April and June. The banking system in Colombia is struggling with a lower demand for credit and persistently high delinquency rates. Nu Colombia is offering some of the highest interest rates in the country, with lower costs and fees than traditional lenders. The bank is showing the rest of the financial system that it needs to improve efficiency. The market has been hampered by interest rate caps that have made it difficult to approve cards for customers due to a lack of credit history.

Child Care Costs Challenge Women’s Gains in Work Force - New York Times

• Participation in the labor force has surged among women in their prime working years

• Mothers with children under 5 may have seen a plateau in labor force participation gains

• Lack of available and affordable child care options may be preventing more mothers from working

• Labor force rebound was stronger among women than men, particularly mothers of young children

• Factors include remote work, federal subsidies, and a tight labor market

• $24 billion in aid allocated to the child care industry expired in September

• Some employers are tightening expectations about working on site, making it more difficult to balance job demands with needs at home

• Barriers to child care may be rearing up again for mothers hoping to get back into the work force

Let the Pros Play With the ‘Trump (or Harris) Trade’ - New York Times

• The old Wall Street adage of “Sell in May and go away” is no longer relevant due to political shifts in the market.

• The Trump trade, a financial strategy associated with the shifting fortunes of former President Obama, is being called and connected to movements in the prices of gun, prison, and fossil-fuel energy stocks.

• Private prison companies Geo Group and CoreCivic saw significant gains in the weeks after President Obama’s election in 2016, but fell more than 67% during the Trump administration

• A second Trump administration would presumably be bullish for prison stocks as they promised to expel millions of undocumented immigrants and lock up many of them first

• However, those gains were short-lived and not sustained

• Traders are looking for profits linked to politics, but it is important to stay invested for the long haul and stay away from quick trades

• Low-cost index funds that hold the entire stock and bond markets are recommended for long-term investing

• Politics are too important to ignore in this year’s market outlook

2025 Could Be a Great Time to Be President, Economically Speaking - New York Times

• The US economy is expected to have a solid outlook in the next few years, with inflation returning to normal and the Federal Reserve preparing to cut interest rates.

• Infrastructure spending under the Biden administration is likely to break ground in earnest in 2025 and 2026, with a burst in green-energy, manufacturing, and infrastructure investment expected to continue over the next several years.

• The president who shepherded some of the policies that are laying the positive groundwork for the positive economic outlook won’t get to take credit for it. The Republican platform pledged to lower interest rates and prioritize infrastructure and manufacturing on the campaign trail, which could be well within reach if economists’ projections come true. The Federal Reserve’s preferred inflation measure peaked at more than 7% in 2021 and 2022, but has since cooled to 2.6%.

• With inflation fading, policymakers predict that interest rates could be cut to 4.1-3% by the end of next year and 3.1% by 2026 to bring inflation back under control. It would still be higher than the rock-bottom rates that prevailed in the 2010s but considerably less costly to borrow money.

China Is Closing the A.I. Gap With the United States - New York Times

• Chinese tech companies have unveiled technologies that rival American systems

• A.I. generated videos created from text prompts using Kling, a video generator made by the Chinese company Kuaishou

• Chinese companies are more willing to release their technologies to consumers or even share the underlying software code with other businesses and software developers

• Open source has been a cornerstone of the development of computer software, the internet and, now, artificial intelligence

• China’s progress is accelerating.

China Rules Solar Energy, but Its Industry at Home Is in Trouble - New York Times

• China dominates the global market for solar energy, with nearly every solar panel on the planet made by Chinese companies.

• However, China’s solar panel domestic industry is in upheaval, with wholesale prices plummeting by almost 50% and stock prices of its biggest makers of panels and equipment halving in 12 months

• Chinese manufacturers are cutting prices far below their costs to compete for customers and still building factories

• The solar sector highlights China’s industrial policy of choosing industries to dominate, flooding them with loans and letting companies fight it out

• China’s approach can lead to big financial losses for local governments, state investment funds, and state-supported banks

• Automakers in China are following the solar industry’s lead in cutting prices sharply and ramping up exports to compensate for a slowing domestic economy

• Beijing’s spare-no-expense policies are drawing criticism from the United States, the European Union, and other trading partners

• Former President Donald Trump has called for an end to the Biden administration’s renewable energy programs.

News updates from July 26: Sabotage hits French railways before opening ceremony; Ackman postpones Pershing Square IPO - Financial Times

• US consumer sentiment fell to 8-month low in July due to inflation and election uncertainty

• Consumer sentiment index registered a final reading of 66.4 in July, down from 68.2 in June and the lowest level since last November

• Inflation expectations for the coming year fell for a second consecutive month to 2.9%

• US stocks opened higher on Friday, with the S&P 500 and Nasdaq recording their worst trading sessions since late 2022

• Personal Consumption Expenditures index for June showed that inflation rose 2.5% annually, in line with economists’ expectations

• Short seller Andrew Left charged with fraud for allegedly manipulating the market through a long-running market manipulation scheme

• German companies warn over increased risk of Russian sabotage attempts during the Olympic Games

Tech reversal pushes US megacaps into correction territory - Financial Times

• Four of the Magnificent Seven technology stocks are in correction territory, down more than 10% from recent peaks

• Microsoft and Amazon are close to the double-digit falls that define a correction

• Investors are worried about punchy valuations and the risks of returns from AI-related spending

• Alphabet, Meta, and Google parent Alphabet have fallen 14%, 12%, and 14% respectively

• Tesla lost 12% after slowing sales and AI spending shrank profits more than expected

• Companies that missed expectations saw their shares drop 3.3% in the days surrounding their earnings

• The earnings season has coincided with a rotation among investors away from tech names in favour of smaller companies.

Musk’s X faces questions from watchdog over AI data grab - Financial Times

• Elon Musk’s X is allowing users’ data to be automatically fed into its AI start-up xAI without their explicit consent

• Users’ posts on the site and interactions with its Grok chatbot can be used for training and fine-tuning xAI’s systems

• The move may breach EU privacy law and could result in fines or penalties from the Data Protection Commission

• X has faced scrutiny from regulators globally for cutting back staff and moderation capabilities and sudden product changes

• Privacy experts have questioned whether X’s move might breach GDPR rules

• Meta paused a plan to train its AI on data from Facebook and Instagram in Europe due to GDPR compliance concerns

• Some investors in xAI see synergies with other Musk entities as a critical advantage, while others have raised concerns about potential conflicts.

AI start-up Anthropic accused of ‘egregious’ data scraping - Financial Times

• AI start-up Anthropic accused of aggressively scraping data from websites to train its systems

• Freelancer.com received 3.5mn visits from an Anthropic-linked web crawler in the space of four hours, according to data shared with the Financial Times

• Anthropic has created some of the world’s most advanced chatbots, including OpenAI’s ChatGPT and Claude

• Websites use a protocol known as ‘robots.txt’ to try to keep crawlers and other web robots off portions of their sites

• Data scraping has ramped up dramatically in the last two years as a result of the AI arms race

• AI crawlers have cost websites significant amounts of money in bandwidth charges and caused them to spend a large amount of time dealing with abuse

The Paris Olympics sabotage attack: what we know so far - Financial Times

• France was hit by a sabotage attack that paralysed its high-speed train network hours before the Olympics opening ceremony.

• Saboteurs cut electricity cables and set fire to crucial equipment, bringing services to a halt on train lines connecting Paris to regions to the north, east, south, and west

• Attackers purposefully targeted spots at junctions of multiple lines to ensure broad damage to the network

• Police and intelligence services were monitoring threats that could disrupt the Games, including Islamist militants, state actors, and political activists

• A massive police presence of 45,000 officers has been deployed in Paris, a security perimeter on the Seine river has been locked down, an anti-drone system deployed and a no-fly zone established

• French police have been checking up on people on so-called Fichier S watch lists, who are suspected of links to Islamist militants or militant activist groups

• Russian athletes are banned from competing under the country’s flag due to doping violations and Moscow’s full-scale invasion of Ukraine, giving them more reason to attack the Games

• The Paris organized crime division is leading the investigation.

OpenAI Tests SearchGPT, Taking Aim at Google - Wall Street Journal

• OpenAI has partnered with publishers to build a new AI search tool called SearchGPT. The tool will summarize information found on websites and allow users to ask follow-up questions. It is OpenAI’s most direct challenge to Google’s dominance in search since the release of ChatGPT in 2022.- Other AI companies, such as Perplexity, are also entering the search battle. Publishers are concerned that AI-powered search tools from OpenAI or Alphabet’s Google will serve up complete answers based on news content, starving publishers of online traffic and advertising revenue. OpenAI plans to offer a wait list for U.S. users to sign up to try the tool. News publishers and creators will be among the first few testers and creators.

This Summer’s Shopping Trend Is a Minimalist’s Nightmare - Wall Street Journal

• Accessorizing with accessories is becoming more popular than just jewelry or matching outfits with handbags.

• Popular accessories include lip-balm holders for Stanley tumblers, Jibbitz charms for Crocs, PopSockets for Kindles, and Bogg bags for beach and pool-goers.

• Social media platforms like Instagram and TikTok have a significant influence on purchasing and buying new accessories. People tend to go to retailers for items they already know they want, while they go to social media for inspiration and impulse buying.

• 28% of Americans who are interested in accessories want other people to like and notice what they wear, especially if they consider it a way to express their personalities online.

Google Talks to Acquire Cybersecurity Startup Wiz Fall Apart - Wall Street Journal

• Google’s talks with Wiz have fallen apart.

• Wiz is now aiming for an initial public offering.

Alexa Is in Millions of Households—and Amazon Is Losing Billions - Wall Street Journal

• Amazon has lost tens of billions of dollars on its devices business, which includes Echos and other products such as Kindles, Fire TV Sticks and video doorbells.

• The company launched Echo smart home devices with its Alexa voice assistant in 2014, but customers mostly used it mostly for free apps such as setting alarms and checking the weather.

• Amazon is launching a paid tier of Alexa as part of a plan to reverse losses, but even some engineers are worried it won’t work

• CEO Andy Jassy is rethinking the Bezos-era metric inside Amazon called downstream impact, which assigns a financial value to a product or service based on how customers spend within Amazon’s ecosystem after purchase

• Downstream impact has been used across Amazon business lines, from its Prime membership program to its video offerings and music

• Some Amazon devices can count on direct revenue, such as selling users subscriptions attached to the product

• In other cases, the downstream impact idea broke down, according to people familiar with the devices business

• Former CEO Jeff Bezos introduced a Kindle Fire tablet in 2011.

Google Is Keeping Cookies in Chrome After All - Wall Street Journal

• Google is ending its plan to eliminate cookies in its Chrome browser after four years of efforts, delays, and disagreements with the advertising industry.

• Advertisers objected to the plan to replace cookies, saying it would force them to shift spending to Google’s digital-ad products

• Google will present users with a prompt to decide whether to turn cookies on or off instead of eliminating them

• The transition requires significant work by many participants and will have an impact on publishers, advertisers, and everyone involved in online advertising

• U.K. regulators opened an investigation into whether the plan would hurt competition in digital advertising, and Google delayed cookies’ demise beyond the last announced target date of end of this year.