Features

Investors ignore the law of long-term averages

14 Nov 2024

US stocks are trading at 38 times cyclically adjusted earnings, near the most expensive level ever on that measure. For more than two decades, equities have defied predictions that valuations return to the historical mean. Yet conditions which enabled juicy returns are fading.

Shein margin wobble takes bite out of IPO value

14 Nov 2024

The e-commerce giant’s revenue growth slumped in the first half of 2024, and the net margin fell to 2% per The Information. Even if the business recovers, it creates uncertainty that’s compounded by a protectionist US government. Investors may struggle to see the upside.

Gulf’s AI strategy is built on more than sand

13 Nov 2024

The UAE and Saudi are raising $200 bln for artificial intelligence. A reliance on imported chips means AI superpower status akin to China or the US is unlikely. But even if the region can’t build a ChatGPT-killer, it can carve out a niche to make the exercise worthwhile.

COP29 will highlight bifurcated energy transitions

12 Nov 2024

Donald Trump’s election victory casts a pall over the UN climate confab in Baku. It will also make raising $1 trln a year from rich states to decarbonise the developing world even harder. But his return will also hasten a shift East and South in the fight against global warming.

HSBC can stand strong in a fragmenting world

7 Nov 2024

The $170 bln bank is uniquely dependent on East-West linkages at a time when global tensions are rising. Yet it weathered the last US-China tit-for-tat fairly well. And supply-chain shifts could even boost the lender, if CEO Georges Elhedery can help it adapt to new trade flows.

Saudi megafund’s success rests on fuzzy local bets

5 Nov 2024

The kingdom’s $950 bln Public Investment Fund is best known for outlandish construction schemes and flashy foreign forays. But its biggest and fastest-growing division houses young domestic firms. While some may thrive, it’s less clear they can guarantee the vital pivot from oil.

China consumer is epitome of delayed gratification

4 Nov 2024

Beijing says it wants to boost consumption’s 53% share of GDP as investment-led growth fades. Yet central planning is hard to square with free-spirited spending. Rebalancing without a period of stagnation is not easy. Recent policies also suggest the old model is hard to ditch.

Saudi’s Davos is no longer such a desert

1 Nov 2024

Around 8,000 CEOs and financiers flocked to the Future Investment Initiative in Riyadh, twice the number at its inception in 2017. Western bosses were keener to talk about artificial intelligence than investing in the kingdom. But Saudi’s progress suggests that may yet change.

Global banks are nearing peak regulation

31 Oct 2024

Sixteen years after the financial crisis that triggered bailouts and new rules, CEOs like JPMorgan’s Jamie Dimon are pushing back. Sympathetic politicians and competition from shadow banks help their case. The best hope for watchdogs is to stop the system from fragmenting.

China is reshaping, not choking, private business

30 Oct 2024

Tech giants and property developers have tumbled, while party support lifted electric carmaker BYD and solar powerhouse Longi. A blurred line between state-backed and private firms does not preclude innovation or competition in the $18 trln economy. Disdain for market forces can.