Apple: Revenue will be lower due to China (updated)

The US mobile phone manufacturer Apple (AAPL) has lowered its forecast for the fiscal-first quarter revenue outlook due to the China market. Apple says that it expects the revenue to be 84 billion dollars in the quarter. According to Bloomberg estimates, the revenue expectation was 91,3 billion dollars in average.

– While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in Greater China. In fact, most of our revenue shortfall to our guidance, and over 100 percent of our year-over-year worldwide revenue decline, occurred in Greater China across iPhone, Mac and iPad, Apple´s CEO Tim Cook said in an investor letter on Wednesday.

According to Cook, the other figures “remain broadly in line with our earlier estimates”. He also pointed out, that the revenue stream outside of the iPhone grew almost 19 % year-on-year. For example Wearables grew almost 50 % on annual basis. Also the services generated over 10,8 billion dollars during the quarter and according to Cook the company is on track to achieve its goal of doubling the size of this business from 2016 to 2020.

In spite of the cutting forecast, Cook expects to set all-time revenue records in several developed countries, including the United States, Canada, Germany, Italy, Spain, the Netherlands and Korea. – And, while we saw challenges in some emerging markets, others set records, including Mexico, Poland, Malaysia and Vietnam, he added.

Apple´s stock fell in after-hours trading about 7 % to 147 dollars.  Apple is to publish its final first fiscal quarter, ended 29th December 2018,  on the 29th January 2019.

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Business Tech

Highlights of the year 2018 – Brexit, trade talks and green finance

The year 2018 was a year of Brexit, electric cars and trade talks. It included special moments in the financial markets and in the company side. Green Bonds and Green Finance were getting more attention in the markets and trade talks and Brexit were the topics during the year 2018 along. Climate Change and low carbon landed also in the agenda of central banks.

Investors were also asking what is the role of the City as a global financial hub. Should it have its own rules in spite of the Brexit? In the financial hub competition, Frankfurt and Paris were the European cities to get more new financial offices as financial companies were moving some operations to the EU side.

The UK Parliament is expected to vote of the Brexit during Janury 2019 after very intensive debate about the deal during the year.

Climate Change has become part of the everyday life in the financial markets and for example one of the biggest insurance companies in the US, Berskhire Hathaway informed in February 2018, that it has got 3 billion dollars losses of the natural catastrophies, the hurricances in the US. Several central banks, including the European Central Bank and some Asian ones, have also agreed about the co-operation in the climate issues and how to monitor the impact on the markets.

In the tech-side augmented reality and ioT were the themes for the year. Apple, Amazon, Google, Tesla, Intel  and Samsung  were one of the tech-companies to deliver new services related to the new technology. On the other side of the topic, Facebook was dealing with the privacy issues globally. New tech- companies listed in the markets were for example Spotify and Xiaomi.

Year 2018 was a year of electric cars in many countries. The e-cars breakthrough with charging issues was one of the tech topics as well. Telsa founder Elon Musk was the leading industry sector figure as he estimated that Tesla would make one million cars by 2020 in February 2018.

Also the German automakers announced new investments and concept cars. For example the BMW Group launched an autonomous driving campus in Munich in March 2018.

Year 2018 was also a year for luxury goods and services. The Basel World 2018 -fair announced its good selling and for example the CEO of Hublot, Ricardo Guadalupe,  told ComteamPUB+ that the company expects double digit growth for the year and that the Chinese customers will be the leading segment.

In the debt markets the US Uber and Netflix issued their junk bonds to investors. Uber, the ride-sharing company, is said to plan an IPO for the year 2019 according to the secret filings to the SEC.

One of the biggest infrastructure projects ever, the China Silk Road, is getting more attention from the green investors side, while the organization made its first announcement of the green principles for the project co-operation and operators. The ancient Silk Road is expected to rise the GDP growth by 4 % or 240 billion dollars in the countries invlolved according to Credit Suisse analysis.

The aim of the Roman time Silk Road is to connect the western Europe with the eastern coast of China and to renew the infrasturcture in between. This means also that the 10 world largest container ports are located along the route.

Trade talks between different countries have continued lively during the year. US and China have been in the headlines, but also the EU with its agreement with Japan.  The political situation and rising volatility in the financial markets tell the direction for the next year. Geopolitical easing is needed.

Päivi Härkönen, co-founder, ComteamPUB+

 

 

Business Finance Lifestyle

China easing auto tariffs for US cars -stocks gained

According to US Trump Administration, China has agreed to cut  tariffs on the US built autos and auto parts to 15 % from the current 40 % level. This news helped to heal the US stock markets and for example the automotive shares gained because of this.

The markets are also expecting that the wider trade talks between the US and China seem now a little easier for both parties. The countries agreed in the G20 meeting in Argentina to postpone the tariffs by 90 days.

Dow Jones ended down 0,22 % to 2437 points, S&P 500 -index ended down 0,04 % to 2636 points, but the Nasdaq-index ended up 0,16 % to 7031 points. In Europe the UK FTSE 100 -index ended up 1,51 % to 6835 points, the German DAX-index ended up 1,49 % to 10780 points and the CAC40 in Paris ended up 1,35 % to 4806 points.

The euro was trading flat at 1,13 dollars. The sterling gained slightly 0,01 % and was trading at 1,248 dollars.

The UK – EU Brexit situation is expected to gain some new input on Thursday and Friday, when the EU meeting in taking place. In the meanwhile UK Prime Minister Theresa May have had discussions with different country leaders about the Irish border issue and resassurances. Today she met the German Chancellor Angela Merkel in Berlin.

Many EU leaders have said that they want to help the UK to reach the Brexit deal in order to avoid the situation that there is no deal at all. The Bank of England has made analysis of the hard-case and the economic impact would be very difficult for the UK trade and economy.

Business Finance

Green Principles for the China Silk Road

China has set new green principles for the China Belt and Road Initiative (BRI).  The leading organizations The Green Finance Committee of China Society for Finance and Banking together with the City of London Green Finance Initiative have jointly co-operated in the project.

The aim of the principles is clear: to foster environmental issues and sustainability in the area and to foster environmental, social and governance risk factors into decision-making processes and conduct due diligence and develop risk mitigation and management plans with the help of independent third-party service providers.

The organizations will also disclose environmental information and greenhouse gas emissions (GHG), water use and deforestration. One of the reporting models will be the Task Force on Climate-Related Financial Disclosure.

The companies are also encouraged to have more communications with different stakeholders and use modern, green finance instruments like green bonds and green asset backed securities in financing the green projects.

According to the principles, the companies will also adopt green supply chain management and integrate ESG factors into the supply chain. The principles are voluntary, but the signatories are expected to adopt and apply these in their investments and operations in the area.

The ancient Silk Road is the of the major infrastructure projects in Asia, which is promoted by the Chinese Goverment.

Business Finance

G20: US and China to halt tradewar

During the G20 meeting in Argentina the US and China leaders, President Mr Donald Trump and China President Mr Xi Jinping agreed to halt the escalating trade war.

According to the White House spokesperson,  President Trump would not follow through his threat to raise tariffs on Chinese goods from 10% to 25% in the new year.  This has been the major issue in the discussions and also one of the biggest threats to global economy.

The countries also agreed that China will buy more agricultural, energy and industrial products from the United States. The aim is to reduce the trade imbalance between the countries.

According to White House, this new statement gives both countries 90 days time to agree upon new trade terms. If such agreement is not ready, the former tariffs increase from 10% to 25 % will become into force.

The financial markets ended up in Wall Street on Friday evening. Dow Jones ended +0,79 % to 25538, S&P 500 + 0,82 % to 2760 and Nasdaq 0,79 % to 7330 points. In Europe the markets were down with the FTSE 100 -index -0,83 % to 6980 and German Dax-index -0,36 % to 11 257 and CAC 40-index in Paris -0,05% to 5003.

Euro declined 0,67 % to 1,13 US-dollars and UK sterling ended down 0,33 % to  1,27 US-dollars.

Business

China to lead the Swiss Watch export – growth double digit

China has shown the biggest demand for Swiss Watches during the October 2018 figures, according to the Swiss Watch Industry. Watch industry exports have reverted to the sustained trend and totally it was 1987 million Swiss francs, which is 7,2% higher than year ago.

Hong Kong gained 10.3% and the United States 11.1%. China recorded one of its biggest monthly increases for the year at +24.1%.

The main European markets such as the United Kingdom (+5.0%), Germany (+8.7%) and France (+11.6%) were having positive trend, but Italy (-14.7%) and Spain  (-14.7%). exports were declining.

 

Lifestyle

Brexit: May on tour – vote day the 11th Dec

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The British Prime Minister Theresa May has been on tour in order to engage with the Brexit-deal. Today she has been in the Northern Ireland and Wales as part of her campaign. Her message is the same as was released on Sunday in the EU leaders meeting in Brussels.

The main argument still is that this is part of the national interest and the second point is that this is the only Brexit deal, there is not going to be a better one.

The voting day has been confirmed and it is the 11th of December, that is on Tuesday. So, there is excatly 14 days before the vote in Westminister in London. The Bank of England and Goverment  are going to publish their analysis of the economic impact of the Brexit-deal. According to Reuters, this information should be ready tomorrow,  on Wednesday this week.

The financial markets were mixed today. For example the German Dax-index ended down 0,40 percent to 11309,11 points and in Paris the stocks were down 0,24 percent-  the CAC 40 -index ended at 4983,15 points. In London the FTSE 100 -index ended down 0,27 percent and was 7016,85 points.

In Wall Street the stocks were also mixed – Dow Jones -index was up 0,18 percent at 24685,55 points and  S&P 500 -index was up 0,09 percent to 2675,87 points. Nasdaq-index had declined by 0,22 percent and was 7066,08 points.

This week will be important G20 meeting in Argentina and  according to Financial Times the US- China tradetalks have not performed  as good as expected so far. The question of the US- UK tradetalks in post Brexit-time is also one of the topics.

One of the big news today was the General Motors layoffs in the US. The car company announced its plans to cut production at several sites and to lay off more than 14.000 workers. The stock of GM (GM) was down 3,55 percent to 36,32 dollars. President Donald Trump tweeted that he will consider cutting all GM subsidies because of the plans. “including the electric cars”, he tweeted according to CNBC.

The euro was down by 0,30 percent to 1,129 US-dollars and the sterling was down by 0,76 percent to 1,2730 US-dollars.

 

 

 

 

 

Business Finance