News of the day

The US Navy has two carrier strike groups operating in the South China Sea, and China is not pleased.
The Chinese Foreign Ministry accused the US of destabilizing the contested waterway, and Chinese media boasted about China’s ability to target US aircraft carriers with anti-ship weapons.
In a tweet Sunday, the US Navy said that it is “not intimidated,” and a meme posted by the Navy on Instagram stressed that it has no plans to leave the South China Sea.

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The US Navy tweeted Sunday that it is “not intimidated” by China’s weapons, after Chinese media boasted about Beijing’s “carrier killer” missiles in response to the presence of two US carrier strike groups in the South China Sea.

The Nimitz and Ronald Reagan carrier strike groups are conducting dual carrier operations in the contested waterway, over most of which Beijing claims sovereignty. The last time the US had two carriers operating in the South China Sea was nearly six years ago.

Joint operations included “air defense exercises, tactical maneuvering drills, simulated long-range maritime strike scenarios, and coordinated air and surface exercises to maintain combat readiness and maritime superiority,” the US Navy said in a statement.

On July 4, a B-52 Stratofortress bomber from Louisiana linked up with the carriers for combined operations.

A #B52 bomber from Louisiana took off from home station on July 4th and participated in a maritime integration exercise with two aircraft carrier strike groups in the South China Sea before landing at Andersen Air Force Base, Guam. pic.twitter.com/GjxAJTx0bf

— AFGSC (@AFGlobalStrike) July 5, 2020

The Global Times, a nationalist Chinese tabloid, argued Sunday that the “South China Sea is fully within the grasp of the Chinese People’s Liberation Army,” and “any US aircraft carrier movement in the region is solely at the pleasure of the PLA.”

The incendiary paper pointed to Chinese anti-ship missiles, specifically the DF-21D and DF-26.

The US Navy responded on Twitter, writing that it is “not intimidated” by the Chinese arsenal and that the carriers are there “at our discretion.”

And yet, there they are. Two @USNavy aircraft carriers operating in the international waters of the South China Sea. #USSNimitz & #USSRonaldReagan are not intimidated #AtOurDiscretion https://t.co/QGTggRjOul

— Navy Chief of Information (@chinfo) July 5, 2020

The Navy has repeatedly stressed that it plans to continue to operate in the South China …read more

Source:: Business Insider

Many direct-to-consumer upstarts have steered clear of joining the boycott called for by civil rights and other groups to protest hate speech on Facebook amid nationwide protests over racial injustice.
As of July 2, prominent DTC brands including Bark & Co., Casper, Daily Harvest, Freshly, Glossier, Harry’s, and Stitch Fix were all still actively running ads across Facebook and Instagram in the US.
The economic downturn has made it hard for DTC companies to abandon Facebook since it’s one of their core business drivers.
But a group of DTC industry insiders is demanding that Facebook enforce its existing policies against hate speech and incendiary language, stop misinformation on its platform, and hold politicians and elected officials to the same standards as other users.
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Hundreds of big-name advertisers from Unilever to Verizon are walking out of Facebook as a part of the Stop Hate for Profit boycott. But barring a handful of companies, many direct-to-consumer upstarts have steered clear of joining the boycott called for by civil rights and other groups to protest hate speech on Facebook amid nationwide protests over racial injustice.

As of July 2, prominent DTC brands including Bark & Co., Bombas, Casper, Daily Harvest, Freshly, Glossier, Harry’s, Ro, Stitch Fix and Smile Direct Club were all still actively running ads across Facebook and Instagram in the US, according to Facebook’s Ads Library.

Bark & Co, Daily Harvest and Stitch Fix were among the top 25 DTC spenders on both platforms, collectively shelling out more than $5.5 million in June, according to advertising analytics company Pathmatics.

DTC brands and millions of other small businesses heavily rely on Facebook’s advertising platform to sell their goods and services. Small and medium-sized businesses account for 76% of all spending on Facebook according to Deutsche Bank, and aren’t in a position to boycott a highly effective channel of marketing, especially during the economic downturn, industry experts said.

“For the bigger legacy brands, there’s not so much of a cost to them coming off Facebook,” said Christie Nordhielm, associate professor at Georgetown University’s McDonough School of Business. “For the smaller DTC brands, it’s a question of money versus morality, and morality can be a luxury in business sometimes.”

Business Insider reached out to 15 DTC brands including Bark & Co., Bombas, Casper, Daily Harvest, Freshly, Fridababy, Glossier, Harry’s, Iris Nova, Mailchimp, Peloton, Ro, Stitch Fix and Smile Direct Club and Untuckit, and 14 declined …read more

Source:: Business Insider

Goldman Sachs has created a new metric to evaluate the relationship between US and China and its impact on markets.
The US-China “relations barometer” is not limited to an evaluation of only trade risks, but also analyses technology, capital markets, and geopolitics.
There is “still decent risk/reward for Chinese stocks unless US-China relations substantially deteriorate from here,” Goldman strategists wrote in a research note.
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A focus on trade relations between the US and China is not the best approach to judge market risk, according to Goldman Sachs.

The investment bank formed a US-China “relations barometer” that assesses not only trade risks, but also those linked to technology, capital markets, and geopolitics.

“Focusing exclusively on bilateral trade frictions is no longer sufficient for investors to comprehend the complicated US-China dynamics and to subsequently assess risk/reward in the equity market,” strategists at the bank wrote in a research note dated July 5.

Sources of tension between the countries emerged during 2018 and 2019 when trade and technology dominated investor concerns. But the focus has shifted to more strategic issues, such as the US opposition to a new security law in Hong Kong, strategists said.

Unless US-China tensions significantly deteriorate, there is “still decent risk/reward for Chinese stocks” the note said, leading to an “overweight” call for investment in the region from Goldman.

Read More: ‘We may have a blow-up’: Famed investor Jim Rogers explains how central bank ‘madness’ has the stock market hurtling towards another crash

“Old Economy and Value may have generally overreacted to the rising tensions, while ‘New China’ and Growth may have under-priced the US-China risk,” the strategists wrote.

Read More: GOLDMAN SACHS: Buy these 13 stocks that are poised to crush the market within the next 2 weeks as earnings season gets underway

After the US-China trade war kicked off in 2018, Goldman Sachs developed a “trade tension barometer” and its implied probabilities for stock valuations, but the bank believed it no longer accurately reflected wide-ranging issues affecting the markets.

Assets that are most exposed to US-China relations are technology companies and American Depositary Receipts, the note said.

At the same time, companies focused on domestic-demand-consumption and others in healthcare are “relatively immune.”

Below is a selection of stocks Goldman says do better or worse than normal during periods of rising tension:

On Monday, Chinese stocks recorded their best intraday rise in a year as investors pinned their …read more

Source:: Business Insider