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Adding to the market's cheer, China's economy showed some muscle at the end of 2024, which investors found encouraging.The country's growth reached the 5% target set by the Communist Party, thanks to a vigorous acceleration in Q4. A performance based on the measures announced at the end of Q3 or on the magic of official statistics. I'll let you choose which. Economists were expecting an average of 4.9%.
On the home front, UK stocks also got a lift from disappointing retail sales figures. Why? Because bad news for retail might just be good news for interest rates, with hopes rising for a potential cut in February.
This positive outlook comes despite a backdrop of mixed economic indicators. Notably, UK retail sales fell unexpectedly in December, declining by 0.3% month-on-month, which was below the market consensus of 0.4% growth.
Several UK companies reported significant updates. Smiths Group is under pressure from U.S. activist investor Engine Capital, which holds a 2% stake, to consider selling the company or parts of it. DFS Furniture announced it expects to nearly double its profit for the half-year ending December 29, 2024, due to cost-saving measures and improved order intakes.
In other corporate news, Schroders is reportedly planning to lay off about 3% of its workforce. AstraZeneca received U.S. FDA approval for Calquence plus chemoimmunotherapy for treating mantle cell lymphoma, based on positive trial results.
Things to read today:
- Wall Street thinks US homes are overvalued by 10-35% (Wall Street Journal).
- Do you know Point Nemo? (The Atlantic).
- European carmakers may have to pay a hefty bill for their Chinese competitors' carbon credits (Financial Times).
- Why are we having fewer children (The Conversation).
- We deserve Pete Hegseth (New York Times).
- Ethiopia gets a stock exchange. All it needs now are companies (The Economist).
- Ons, the Swiss sneaker that pisses off Nike and Adidas (Bloomberg).
