Hi Newsletterest, here's what you need to know for June 1st in 3:12 minutes.

☕️ Finimized over a very satisfying latte at The Kirk Café in Hamilton, New Zealand (16°C/60°C 🌧)

Today's big stories

US-China tensions are pushing NetEase toward a secondary listing on the Hong Kong Stock Exchange
Goldman Sachs has predicted what will become the four biggest post-coronavirus trends in investing – Read Now
Credit rating agency S&P downgraded Rolls Royce’s bonds, which may force some investors to sell up

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Choices Choices

What’s Going On Here?

NetEase is already listed on the US stock market, but the Chinese company's now planning a secondary listing in Hong Kong. Well, you can’t blame a tech giant for wanting to keep its options open…

What Does This Mean?

Everything seemed to be going well between the US and China toward the end of 2019, when the two agreed to a truce that brought their years-long trade war closer to a resolution. But tensions have risen again this year with the two slinging mud at each other over the coronavirus outbreak and, more recently, China’s intention to limit Hong Kong’s freedoms with a national security law.

The US president wasn’t happy with China’s decision, and nor was the Senate: it’s since retaliated by passing a bill that’d bar Chinese companies from listing on US exchanges, and even go as far as to delist existing ones like Baidu, Alibaba, and NetEase. The latter’s decision to list elsewhere, then, is its way of protecting its own interests if and when the bill actually goes ahead.

Why Should I Care?

For markets: Open sesame.
NetEase isn’t alone: JD.com, China’s second-largest online retailer, had the same idea. Both companies were likely emboldened by Alibaba’s own hugely successful $11 billion share sale in Hong Kong last year. And seeing as some investors are worried China’s security law announcement will damage Hong Kong’s status as a major financial center, both new listings could give the region’s markets a much-needed boost too.

The bigger picture: Playing hard to get.
There might be another reason Chinese tech companies are heading to Hong Kong. The region’s stock exchange used to have rules banning companies from listing if they had “dual-class share structures” – the kind popular among tech companies whose founders want to keep disproportionate voting rights. But after missing out on several major tech initial public offerings, the Hong Kong Stock Exchange decided to relax those rules almost a year ago to lure them back.

Take action: How to profit from China’s growing tech giants.

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2/3 Premium

Reset Your Sights

What’s Going On Here?

“The Great Reset”, a new report from Goldman Sachs, lays out what the investment bank predicts will become the four biggest trends in investing when the coronavirus is finally over.

Get the full story with Finimize Premium

3/3

Holey Scrap!

What’s Going On Here?

Automotive and aerospace giant Rolls Royce found itself in a heap of trouble late last week when it had the quality of its debt downgraded to “junk”.

What Does This Mean?

Standard & Poor’s (S&P) is a credit rating agency that assesses the creditworthiness of a company or country and issues a report with its findings. Investors then use those reports to figure out just how risky the bonds of the company or country might be, as well as to make more informed investment decisions.

S&P reckons that since Rolls Royce is anticipating lower cash flow and a prolonged stint of weak profitability, its bonds are now a riskier proposition (tweet this). And given that analysts are expecting pandemic-hobbled travel to halve Rolls’ airplane engine service market in the next few years, that’s probably no great, ahem, LEAP in logic. Rolls probably knows that better than anyone, which might be why it announced 9,000 job cuts just last week.

Why Should I Care?

For markets: Heads will Rolls.
Some bond investors who promise to limit how much risk they’ll take – like those committed to “investment grade” bonds, which have been deemed by the likes of S&P to be safe enough for most people – might now be forced to sell their Rolls bonds. That’s especially true if rival credit rating agencies with a more positive view on Rolls change tack and follow S&P’s lead.

For you personally: Yes to debt.
Rolls’s turmoil doesn’t necessarily mean you should avoid debt altogether. For companies, borrowed money might build a factory that’ll make products they can sell, while for you personally, a mortgage could help you buy a property that might increase in value. That’s good debt. Bad debt is the cash a company borrows to pay its dividend, or a credit-fueled luxury holiday.

Take action: How good debt could safeguard your finances.

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💬 Quote of the day

“Work and learn in evil days, in insulted days, in days of debt and depression and calamity. Fight best in the shade of the cloud of arrows.”

– Ralph Waldo Emerson (an American essayist, lecturer, philosopher, and poet)

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📈 All’s well that trends well

Here’s some of the most popular Finimize Premium content from last week…

Premium Insights:
💵 Bank stocks might be going cheap
📉 How negative rates could hit your savings
🌱 Socially responsible investments aren’t looking so responsible

Packs:
🤓 Our analysts talk retail, tech, and stimulus
💪 How to be an ethical investor, even in a crisis
🤨 How likely’s a V-shaped recovery anyway?

📚 What we're reading

Are we about to lose 50 billion years of history? (BBC)
Grimes is selling her soul. Literally. (Pitchfork)
Penguins in a museum? Whatever next! (Design Boom)

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Finimize - 🇺🇸 Big tech leaves America

Today's big stories

Choices Choices

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Reset Your Sights

Holey Scrap!

What’s Going On Here?

What Does This Mean?

Why Should I Care?

📈 All’s well that trends well

Older messages

❗️ Fact-check: Twitter’s screwed

🕺 TikTok's 3 billion dollar moves

🇺🇸 US is back in business

🙄 So much for Alibaba's trillion bucks

🤧 Expedia feels the coronavirus effect

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