Japan's benchmark index, the Nikkei 225 ascended to a new peak despite rising marginally. Samsung Electronics estimated a more than 15-fold rise in its second-quarter operating profit, pushing its shares higher in trade. UK's Labour Party is poised to win the country's elections with a landslide majority, exit polls indicated. All this and more on the July 5 edition of World Street.
Better future
Samsung Electronics estimated a more than 15-fold increase in its second-quarter operating profit, driven by rebounding semiconductor prices fueled by the artificial intelligence boom.
The world's largest memory chip, smartphone, and TV maker projected its operating profit at 10.4 trillion won ($7.54 billion) for the quarter ending June 30, compared to 670 billion won a year earlier. Revenue likely rose 23 percent year-on-year to 74 trillion won. Following the guidance, Samsung shares rose 1.2 percent, outpacing the broader market's 0.4 percent increase. The company's detailed earnings for Q2 will be released on July 31.
Dethroning rivals
Britain’s opposition Labour Party is poised for a significant parliamentary majority in the general election, according to exit polls. These polls estimate Labour winning 410 out of 650 seats, while the Conservatives are projected to secure 131 seats. If these numbers hold, it would mark Labour's second-largest majority since Tony Blair's 179-seat triumph in 1997. The final nationwide results are expected early July 5, with Labour leader Keir Starmer likely to become the next prime minister.
Peaking out
Japan’s Nikkei 225 crossed the 41,000 mark, hitting fresh record highs on July 5, with a gain of 0.22 percent, extending its rally from Thursday. However, the broad-based Topix dipped 0.15 percent from its record high. Meanwhile, Japan’s household spending for May unexpectedly fell 1.8 percent in real terms compared to the same period last year, contrary to economists' expectations of a 0.1 percent rise, according to a Reuters poll. Household spending is a crucial metric for the Bank of Japan in assessing its goal of achieving a "virtuous cycle" of rising wages and prices.
Entering new territory
China’s BYD inaugurated its first electric vehicle plant in Thailand on July 4, marking the automaker’s entry into Southeast Asia’s rapidly expanding EV market, where it has emerged as the dominant player. At the opening ceremony, BYD CEO and President Wang Chuanfu highlighted Thailand’s clear EV vision and its new era of auto manufacturing, stating, “We will bring technology from China to Thailand.”
This plant is part of a substantial wave of investment, exceeding $1.44 billion, from Chinese EV manufacturers establishing factories in Thailand, spurred by government subsidies and tax incentives. Following the announcement, BYD's Hong Kong-listed shares rose 1.6 percent, reaching their highest levels in a week.
Rising prices
Chinese brands MG and Nio suggested on July 4 that they might raise the prices of their cars in Europe later this year following the European Union's confirmation of tariffs on Chinese-imported EVs.
The EU will impose tariffs of up to 37.6 percent on imports of electric vehicles made in China starting July 5, escalating trade tensions with Beijing in Brussels' largest trade case to date. In response to the EU's decision, Chinese automaker Nio stated that it might adjust the prices of its cars in Europe. Meanwhile, a spokesman for MG in France told Reuters that the automaker has sufficient stock to last until November without increasing prices, specifically referring to the MG4 model.
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