Today's big stories

Chinese ecommerce giant Alibaba reported better-than-expected results last Friday, but its stock still fell by almost 4%
Our analysts look at why some investment managers think US bank stocks are such good value – Read Now
Burberry scrapped its dividend as sales fell, and the luxury goods company can’t rely on demand from China picking up anytime soon

1/3

Aliblahblah

What’s Going On Here?

Ecommerce giant Alibaba flashed its trademark smile after reporting better-than-expected results late last week – only to turn that upside-down frown upside down again when its share price dropped 4%.

What Does This Mean?

With coronavirus lockdowns encouraging more people to shop online for the essentials, the Chinese company’s revenue increased 22% in the first three months of the year. And while supply-chain disruptions did hit some of its sellers, Alibaba said it’s seen a steady recovery since March. Then again, Alibaba’s definition of “recovery” probably differs from most other companies’: a record-breaking trillion dollars’ worth of merchandise flowed through its platform in the past year alone (tweet this).

But first-world or not, Alibaba does have problems: the company’s major investments in stocks like ride-hailing company Lyft and Chinese social media platform Weibo have soured due to the coronavirus-induced market slump. Its quarterly profit would’ve increased by 11% if not for those losses, but as it was, that profit fell almost 90%.

Why Should I Care?

For markets: Talk about bad timing.
Despite the better-than-expected results, Alibaba’s Hong Kong-listed stock dropped almost 4%. It fell victim to a wider sell-off in Hong Kong stocks after China’s announcement that a national security law would be imposed on the city, limiting its freedom. The move – which could trigger both a new wave of protests and a flare-up of tensions with the US – caused one measure of Hong Kong stocks to head for its worst daily drop since the 2008 financial crisis.

The bigger picture: Mano e mano.
The US president has already threatened to retaliate if China goes ahead with the law, stoking already-simmering tensions between the two superpowers. Just last Wednesday, for example, the US Senate passed a bill that would bar Chinese companies from listing on US exchanges – and even go as far as to delist existing ones like Chinese tech companies Baidu and, you guessed it, Alibaba.

Learn more: How to profit from China’s economic slump.

Copy to share story: https://www.finimize.com/wp/news/aliblahblah/

🙋 Ask a question

2/3 Premium

We All Float Down Here

What’s Going On Here?

Big US bank stocks are at their cheapest since 2009 compared to the overall US stock market, but just because they’re a tempting way to back the economic recovery doesn’t mean they’re the right way.

Get the full story with Finimize Premium

👋 The US stock market says hello

Our partners at Stake are on a mission to break down the barriers between global investors and the huge US stock market.

Big mission, you say? Sure it is, but if anyone can do it, Stake can. They’re a digital brokerage offering direct and commission-free trading on the US market. They offer over 3,500 US stocks and ETFs, as well as advanced order types, fractional shares, and the ability to trade on unsettled funds. Phew.

Stake’s now arrived in the UK too, where they’re already putting together a growing community of people taking advantage of everything their app offers. And just to sweeten the deal, they’re giving away a free stock in Nike, Dropbox, or GoPro when you join. So quite frankly, there’s never been a better time to open yourself up to the US market.

Join Stake today, and claim your free stock pronto.

Get Your Free Stock

3/3

Found And Lost

What’s Going On Here?

Luxury brand Burberry rooted around to produce some, er, shabby chic results late last week – and investors could’ve sworn its dividend payouts were in there somewhere too…

What Does This Mean?

As the original COVID epicenter, China was the first to impose lockdown orders on its shoppers. That was particularly hard on the luxury sector – which makes a third of sales in the country – and a sign of things to come for Burberry: the British label said coronavirus forced more than half its global stores to close last quarter, cutting sales by 27%.

On the plus side, China’s now among the vanguard of lockdown-lifters, which might be why Burberry’s shares climbed 3% on Friday when management made positive noises about the outlook for Asian demand. Buyers of Burberry stock certainly seemed more optimistic than China’s own government, which abandoned its headline economic growth target altogether last week in the face of the pandemic.

Why Should I Care?

For markets: Red is the new black.
Burberry announced it was scrapping its dividend on Friday, joining a growing catalog of UK-listed companies that have cut shareholder payouts – including once-dependable dividend-distributors Shell and BT. Almost half the companies in the benchmark FTSE 100 have trimmed their payouts in an effort to hoard their cash, but yields on big US stocks are still triple those of bonds right now – the biggest gap in seven decades. Of course, bond payouts are fixed, while the Burberrys of the world can cut their dividends whenever they like…

The bigger picture: No tourists, no sales.
By cutting its dividend, Burberry will save itself nearly $150 million. That might be just as well: lots of European luxury brands rely on Chinese tourists to splash their cash while vacationing in Milan, Paris, or London, dahling. So until international travel returns, Burberry and the like have plenty more to worry about.

Take action: How to profit from the challenges facing fashion retailers.

Copy to share story: https://www.finimize.com/wp/news/found-and-lost/

🙋 Ask a question

💬 Quote of the day

“Emotions are like passing storms, and you have to remind yourself that it won’t rain forever. You just have to sit down and watch it pour outside and then peek your head out when it looks dry.”

– Amy Poehler (an American actress, comedian, writer, producer, and director)

Tweet this

🇺🇸 Welcome to the Land of Hope and Glory

The US stock market is the biggest on the planet, offering endless opportunity and the chance to diversify your portfolio. So meet Stake, a commission-free digital brokerage who know the market back to front.

They offer all sorts of companies they think you might want to keep an eye on. Take big-hitter Apple: despite some early drops in the pandemic, the tech giant’s rallied through May, climbing almost 13% at the time of writing. And you’ve probably heard of Zoom: it’s on track to be a significant winner from the work-from-home revolution, and it’s jumped almost 73% since February.

Or maybe you’d be interested in a blank check company like VectoIQ Acquisition Corp (VTIQ). Soon to become Nikola Motor – a hydrogen-powered electric truck company – through a merger, VTIQ is up 114% in the last month and apparently pretty popular among Stake’s traders right now.

All these stocks, and thousands more, are available when you trade with Stake. And to get you started, you can get a free stock.

Get Your Free Stock

📚 What we're reading

I can see clearly now the required upgrades are in (Science News)
So donut cereal is a thing now (Delish)
Pokémon really did mess with our heads (Aeon)

❤️ Share with a friend

Your Referrals: 0

Thanks for reading Newsletterest. If you liked today's brief, we'd love for you to share it with a friend. If they sign up on your unique link, you’ll earn some sweet swag.

Share your unique link:

https://finimize.com/invite/?kid=177ZWC

Like what you’re reading? Show your support:

You stay classy, Newsletterest 😉

We’d love to hear your thoughts. Give feedback

Image Credits:

Image credits: r.classen, Rido - Shutterstock | Iakov Filimonov, TunedIn by Westend61, Papin Lab - Shutterstock

Preferences:

View in browser

Unsubscribe from all Finimize Emails

😴

Crafted by Finimize Ltd. | Third Floor, 1 New Fetter Lane, London, EC4A 1AN, UK.

All content provided by Finimize Ltd. is for informational and educational purposes only and is not meant to represent trade or investment recommendations. You signed up to this mailing list at finimize.com or through one of our partners. © Finimize 2020

Finimize - 🙄 So much for Alibaba's trillion bucks

Today's big stories

Aliblahblah

What’s Going On Here?

What Does This Mean?

Why Should I Care?

We All Float Down Here

👋 The US stock market says hello

Found And Lost

What’s Going On Here?

What Does This Mean?

Why Should I Care?

🇺🇸 Welcome to the Land of Hope and Glory

Older messages

🤧 Expedia feels the coronavirus effect

⛔️ No more Facebook ads

📈 Walmart loves stockpiling

😓 SoftBank's 18 billion dollar regret

🤬 Recession, recession everywhere

You Might Also Like

🦃 Chipmakers give thanks

John's Take 11-28-24 Puttin’ it on Plastic

Staying afloat: the impact of flooding on UK firms

🇺🇸 US inflation rose

Don’t think you can afford life insurance?

What are you hiding Elon?? (Tesla’s secret 69% dividend)

Giving thanks for inflation, Paul Mescal and more

💚 Holding space for career pivots

Harry's Take 11-27-24 Michael Saylor Has Seen an Impressive Learning Curve Playing Bitcoin at MicroStrategy!

The heterogenous effects of carbon pricing: macro and micro evidence