There's a lot happening on World Street today. Here's a quick look: China's non-manufacturing activity expanded at a slower pace in April; Chinese EV maker BYD reported sluggish net profit and revenue growth in Q1, bearing the brunt of price hikes; Tesla has been given the green light to debut its self-driving technology in China; the EU's steel demand outlook for 2024 has been revised downward for the second time. And much, much more, so read on.
Tesla Speeds Up In China
Elon Musk's trip to China has yielded results, as Tesla will begin to roll out its advanced self-driving technology in China. Tesla needed approval from Chinese regulators, who required the automaker to pass the country's data safety requirements.
Following this, investors expect Tesla's Full Self-Driving or FSD software will be made available in China, the largest EV market.
Looking bleak
The European Steel Association (Eurofer) revised its 2024 steel demand forecast downward for the second time, and is now projecting a growth rate of 3.2 percent. This downward revision reflects ongoing geopolitical tensions, economic uncertainties, and elevated interest rates. Eurofer had initially anticipated a 7.6 percent rise in demand for 2024 but had already lowered it to 5.6 percent back in February. The association noted that the European steel market's outlook for 2024 is facing challenges, resulting in a loss of momentum.
Losing pace
China's non-manufacturing activity expanded at a slower rate in April, according to an official survey released on Tuesday. The slowdown is attributed to disruptions caused by adverse weather in the southern region, affecting the construction and services businesses.
The official non-manufacturing Purchasing Managers' Index (PMI), which encompasses services and construction, declined from 53.0 in March to 51.2 in April, based on data from the National Bureau of Statistics. Similarly, the composite PMI, including both manufacturing and services, dropped to 51.7 in April from 52.7 in March.
The 50-point threshold marks the boundary between expansion and contraction in monthly activity levels.
Facing the brunt
Chinese electric vehicle (EV) manufacturer BYD reported its slowest quarterly profit growth since 2022, with revenue growth also slowing to its lowest level in nearly four years. The growth slowdown for the EV maker is attributed to a softness in demand and intense price competition in the world's largest auto market.
In the first quarter, BYD's net profit grew 10.6 percent to 4.57 billion yuan ($631.08 million), while revenue rose 4 percent to 124.94 billion yuan. Despite the slower growth, BYD still managed to outpace rival Tesla, which reported its first quarterly revenue decline since 2020, when the COVID-19 pandemic disrupted production and deliveries.
Despite this, BYD relinquished its position as the world's top EV seller to Tesla in the first quarter, a title it had held in the previous year.
Yen sinks to 1990 levels
The Japanese Yen sank to its lowest level since 1990, falling to 160.03 against the dollar. The Yen has displayed significant weakness, but it pared the losses to reclaim 156 levels. Analysts suggested that the volatility in the Yen could be the result of the Japanese stock market being closed on April 29; the Japanese unit has, however, been under pressure for long. Since Bank of Japan officials kept interest rates low to encourage inflation, the Yen sank.
Sleeping easier after a settlement
Philips Respironics, a subsidiary of Philips, has reached a $1.1 billion settlement to close claims of personal injury on its recalled sleep apnea devices. In 2021, the firm recalled around 15 million sleep therapy devices over issues that could lead to the user inhaling carcinogenic fumes. The electronic maker did not admit any fault, but the FDA noted that it had received reports about the problem since 2015.
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