Arm's post-earnings pop leaves stock trading at over 100% premium to Nvidia
Arm, the British semiconductor company owned by SoftBank, believes it can benefit from the growth of artificial intelligence (AI) chips, despite its technology being focused on central processors (CPUs) rather than graphics processors (GPUs) typically used in AI applications. Arm's CEO Rene Haas mentioned Nvidia's Grace Hopper 200 chip, a combination of an Arm-designed CPU and an Nvidia GPU, as an example of how Arm can integrate its technology with AI chips. Analysts expect Arm's sales trends to remain strong due to the early adoption phase of AI. Additionally, SoftBank sees an opportunity to directly benefit from the growth in AI by being associated with Arm. It recently reported a $4 billion gain in its Vision Fund investment group, partly due to the investment gain of $5.5 billion from the Arm IPO. SoftBank's finance chief, Yoshimitsu Goto, has referred to the company's investment portfolio as "AI-centric."
Biden says 'my memory is fine,' disputes special counsel's report in national address
The main legal takeaway from the report by Special Counsel Robert Hur is that President Biden will not face criminal charges for retaining classified documents and disclosing some classified material to the ghostwriter of his memoir. The report found that the material was retained at Biden's home in Delaware and an office in Washington, D.C., after he left the vice presidency in 2017. Biden's lawyers maintain that the material was only discovered in late 2022, and the report acknowledges a shortage of evidence as to why the documents were in Biden's possession. Despite this, Hur used evidence of Biden's "poor memory" to justify not pursuing charges, which drew criticism from the White House and Biden's supporters. In response, Biden acknowledged his responsibility and expressed support for the appointment of a special counsel, emphasizing that he did not want to be treated differently than former President Trump. The report concluded that Biden did not break the law, but questions remain regarding his handling of classified documents.
El-Erian, Krugman and other economists have very different opinions on China’s struggling economy
China's economy is facing several challenges, including a crumbling property market, deflationary pressures, and a turbulent stock market. The country's CSI 300 index has lost about 40% of its value since its peak in 2021. Adding to the concerns, the National Bureau of Statistics reported that manufacturing activity in China contracted for the fourth consecutive month due to weakening demand.
Allianz, a prominent financial services company, has revised its outlook for China, downgrading its growth forecast. The company now expects China's economy to grow at an average rate of 3.9% between 2025 and 2029, compared to its previous forecast of 5% before the Covid-19 pandemic.
Eswar Prasad, an ex-International Monetary Fund official, believes that China's chances of surpassing the United States' GDP are diminishing. This comes as concerns grow over China's economic performance and its ability to catch up with the U.S.
Furthermore, Mohamed El-Erian, a top economist and advisor to Allianz, highlighted the stark contrast between China's underperforming stock market and those in the U.S. and Europe. This comparison further emphasizes the challenges China is currently facing in its economy.
Overall, skepticism is growing toward China's economy as a result of the recent downbeat data and challenges faced by the country.