Happy Tuesday!

The MFM will be off on Wednesday and Thursday. We’ll see you again on Friday!

📝 Focus

• TikTokTwitter

📊 In the Markets

• China stimulus, no more Evergrandes?

• Barbiecore

📖 MoneyFitt Explains

🎓️ The Soft Landing

📝 Focus

TikTokTwitter

Over the last few years, social media competitors have tried to copy TikTok's ultra-successful short-form video format. This time, however, it's the other way around as TikTok steps out of its comfort zone and introduces text-based posts alongside videos and photos (which were only introduced last year.) Users can create and share stories, poems, lyrics, recipes and other text posts with background colours, music, stickers and a 1,000-character limit. While it's possible that the TikTok strategy is to step into the crowded field, challenging the dominant microblogging platform Twitter (now known as 𝕏, see below), it could also just be a copy of Instagram Stories to capture even more of the advertising pie... and also take the game to Meta's Instagram, which successfully created Reels by copying TikTok.

..... ▷ The move comes amid a window of opportunity for alternative apps like Meta's Threads, Bluesky and Mastodon to challenge 𝕏, which under Elon Musk has halved its advertising revenue, fired 80% of its engineering staff and alienated many of its users. And it was TikTok's main competitor, Meta, which recently launched Threads to somewhat mixed reviews but an enthusiastic response that saw it hit 100 million downloads just five days after its release in part thanks to the account integration with Instagram (though it's a standalone app.)

..... ▷ 𝕏 is potentially shooting itself in the foot with its rebranding exercise (see below) as it ploughs forward with ambitions to be "the everything app". Meanwhile, TikTok continues to dominate the short-video market and is using that market strength to expand into related opportunities and compete with other popular social platforms.

📊 In the Markets

Barbiecore: US stocks and bond yields rose on Monday in anticipation of central bank meetings, led by energy and financial stocks. The tech-heavy Nasdaq saw the special adjustment for weightings of the mega-caps nicknamed The Magnificent Seven. Of them, only Meta and Amazon were down on the day. Mattel closed up 1.8% on the box office success of the Barbie movie. And Elon Musk went ahead with his widely disliked plan of renaming Twitter and dumping the friendly little blue bird that's been its logo forever in favour of 𝕏 (which is available in totally standard font sets as a "mathematical double-struck capital x").

..... ▷ Traders were positive about a business survey indicating slower growth in the US in July. At 52, it's above the expansion threshold of 50, but the flash composite purchasing managers' index was lower than June's reading and economists' predictions. While not in the "bad news is good news" category, slightly slower but still positive growth raises hopes that there may be no further Fed rate hikes after Wednesday's widely expected 0.25%... potentially setting the stage for a soft landing🎓

China stimulus, no more Evergrandes? US-listed China shares rallied sharply on Monday...not long after Hong Kong had crashed on fears more Mainland property companies could go the way of stricken giant Evergrande. The Nasdaq Golden Dragon Index (HXC) rose 4.3% as China's top leaders, led by President Xi Jinping, indicated increased backing for the struggling real estate sector and measures to boost consumption and tackle local government debt. Though they refrained from announcing any large-scale stimulus plans to boost the sluggish economic recovery, the Politburo promised "counter-cyclical" policies, implying further economic support and potential adjustments to property sector restrictions.

..... ▷ HK/China markets were weak on Monday before the Beijing statement, with HK’s Hang Seng Index (HSI) worse off by far, tanking by more than 2% for the second time in a week. The HSI was dragged down mainly by Chinese property stocks, which hit eight-month lows as concerns over cash crunches at many of the major developers, including Country Garden and Dalian Wanda, reignite bad memories of Evergrande's 2021 default. Country Garden's shares fell 9%, with its services arm plunging double that, while their bonds dropped to trade at just 10-15% of face value.