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Many factories ran at half capacity or less because of weak demand inside China, and are working to export more to make up for it. China’s economy grew 5.2 percent last year as it rebounded from nearly three years of stringent “zero Covid” pandemic control measures, the country’s National Bureau of Statistics announced on Wednesday. During the final three months of the year, output rose at an annual pace of 4.1 percent. Longer term, China’s growth is slowing. High debt, a housing crisis that has undermined confidence, and a shrinking and aging work force are weighing on output.
Organizations: National Bureau of Statistics Locations: China
Hong Kong CNN —Consumer prices in China fell more than expected last month, sliding the country back into deflation and renewing concerns about the strength of the world’s second largest economy. As China’s most consumed meat, pork has an outsized weighting in the consumer price index. He said deflation was a “pernicious” situation characterized by a decline in consumer prices as well as the prices of assets and wages, leading to a sharp slowdown in economic activity. But consumer prices recovered in August. This drop “reflects uncertainty around the solidity of China’s recovery,” HSBC Greater China economist Erin Xin noted in a report.
Persons: Goldman Sachs, Robert Carnell, , Erin Xin Organizations: Hong Kong CNN —, National Bureau of Statistics, Economics, Asia Pacific, ING, ” HSBC Locations: China, Hong Kong
The S&P 500 index (SPX) has risen 11% since the start of the year, the tech-heavy Nasdaq (NDX) 33%, and the Stoxx Europe 600 (STOXX) 5%. The Stoxx Europe 600 has fallen 3.3%. ‘Higher for longer’ interest ratesThe world’s major central banks have spent the past two years hiking borrowing costs in a bid to control runaway inflation. High interest rates typically put pressure on stocks, since investors tend to favor bonds when they offer comparable returns as they are safer. An ailing ChinaA slew of disappointing economic data out of China has also put pressure on stocks.
Persons: Michael Hewson, , Cushing, Strategic Petroleum Reserve —, Goldman Sachs, Giovanni Staunovo, Brent, stoking Organizations: London CNN —, CMC, CNN, Nasdaq, Federal Reserve, Brent, Strategic Petroleum Reserve, UBS, country’s National Bureau of Statistics, Evergrande Group Locations: United States, Europe, Saudi Arabia, Russia, OPEC, Cushing , Oklahoma, Ukraine, Saudi, China, Hong Kong
New York CNN —David Solomon, CEO and president of Goldman Sachs, is getting bad press — a lot of bad press. And while shares of Goldman Sachs (GS) may be down by more than 5% this year, they’re still up by about 40% since he took over in 2018. Goldman Sachs did not respond to requests for comment for this article. Before the Bell: What is going on at Goldman Sachs? There have been articles purporting that former Goldman CEO Lloyd Blankfein isn’t happy with the job David Solomon has done and that he has offered to step in to help.
Persons: David Solomon, Goldman Sachs, Marcus, Solomon, they’re, Bell, Jeffrey Sonnenfeld, Lloyd Blankfein isn’t, that’s, Lloyd, he’s, That’s, David, , Juliana Liu, Michelle Toh, ” Julian Evans, Pritchard, Zichun Huang, Hang, Lehman, Hillary, Eva Rothenberg, Harry Reid, Hilary Organizations: CNN Business, Bell, New York CNN, Financial Times, Yale School of Management’s, Leadership Institute, Nokia, BlackBerry, Microsoft, Goldman, People’s Bank of China, Reuters, Capital Economics, Hang Seng, The Bank of Korea, Bank Indonesia, country’s National Bureau of Statistics, Harry, Harry Reid International, San Diego International Locations: New York, Lloyd, China, Hong Kong, Shanghai, Asia, Las Vegas, California, Nevada, Southern California, Idaho
Why stock investors are suddenly so scared
  + stars: | 2023-08-18 | by ( Nicole Goodkind | ) edition.cnn.com   time to read: +6 min
That means that if China’s economy slows down, global economic growth slows down. “When global economic growth slows down, that tends to be negative US equities. But a string of strong economic data has challenged those notions. Russia’s invasion of Ukraine continues to stoke fears of rising commodity prices, global economic instability and uncertainty around security. It’s been chock full of economic data and big corporate reports.
Persons: That’s, Lehman, , Alex Etra, Bond, Jamie Dimon, JPMorgan Chase, hasn’t, Banks, Michael Burry, Fitch, It’s Organizations: New, New York CNN, Nasdaq, Dow, CNN, country’s National Bureau of Statistics, Apple, Intel, Starbucks, Nike, Federal, Federal Reserve, Atlanta Fed, JPMorgan, CNBC, First Republic Bank, Huntington Bank, PacWest, Western Alliance, Bank Locations: New York, China, Ukraine, Beijing, stoke, Huntington
Why it matters: “For most of the last two decades, China’s economic growth has been a major driver of the global economy,” said Alex Etra, a strategist at data analytics firm Exante. That means that if China’s economy slows down, global economic growth slows down. ExxonMobil (XOM) may not be doing too much business with China, said Etra, but if Chinese growth slows, that means oil prices go down. Earlier this year, Bank of America compiled a list of the S&P 500 companies with the highest exposure to China. The grand total of all the private wealth in the world fell 2.4% to $454.4 trillion last year, according to the annual Credit Suisse and UBS global wealth report.
Persons: Joe Biden, BlackRock, , Alex Etra, Michael Burry’s, Allison Morrow, That’s, Jason Hart, Winn, ” Hart, , Ramishah Maruf Organizations: CNN Business, Bell, New York CNN, country’s National Bureau of Statistics, ExxonMobil, Apple, Intel, Starbucks, Nike, Bank of America, Las, Qualcomm, Nvidia, Wynn Resorts, WYNN, MGM Resorts, MGM, Funds, PitchBook, Michael Burry’s Scion Asset Management, Moore Capital Management, D1 Capital, Tiger Global, Securities, Exchange, Credit Suisse, UBS, Millionaires, Aldi, Dixie, Winn, CNN Locations: New York, Beijing, China, Ukraine, United States, Aldi, Winn
The United States has spent much of the past 18 months struggling to control inflation. China is experiencing the opposite problem: People and businesses are not spending, pushing the economy to the verge of a pernicious condition called deflation. For 10 straight months, the wholesale prices generally paid by businesses to factories and other producers have been down from a year earlier. Deflation is particularly serious in a country with very high debt, like China. Overall debt is now larger in China, compared with national economic output, than in the United States.
Organizations: National Bureau of Statistics Locations: States, China, Japan, United States
“My forecast is for a further decline of 1.2% [on a quarterly basis for China’s GDP]. China’s GDP declined 2.6% in the second quarter from the previous one, reversing a 1.4% growth in the January-to-March period. Economists polled by Reuters have expected China’s GDP to expand by 3.4% in the third quarter from a year earlier. Many international organizations, including the IMF and World Bank, have recently downgraded China’s GDP growth forecasts for this year. Bennett expected the third-quarter GDP data to be released after the Party Congress.
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