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| | Top News  Getty Images As the world's two largest economies move increasingly farther apart, companies that fear of getting hurt by the fallout are making moves. Some are diversifying or relocating their business operations to friendlier regions, while others are doubling down on their lobbying efforts to make sure they are not harmed. Tesla (NASDAQ:TSLA) is just one of the firms navigating the tricky waters, and the latest has even prompted Elon Musk's first visit to the country since a launch ceremony at Giga Shanghai in January 2020 (remember the dance moves?)
Thought bubble: China represents Tesla's largest market outside the U.S. (22% of its revenue) and is critical in terms of the EV maker's supply chain (accounting for more than half of its global output). Things like export controls, data security, and restrictions on sensitive technologies can also impact the company's bottom line and future market share. Teslas were previously banned from Chinese military complexes and housing compounds in early 2021 (and that was expanded in 2022), while a lot of assurances will have to be made with regard to the driving information that's collected by cameras built into its vehicles.
"The interests of the United States and China are intertwined, like conjoined twins, who are inseparable from each other," Musk was quoted as saying to Foreign Minister Qin Gang. He also met with China's commerce and industry ministers, and dined with Zeng Yuqun, chairman of top battery supplier CATL. TSLA shares rallied over 4% on Tuesday after Musk touched down in Beijing, pushing the stock over $200 for the first time since March, but Tesla still faces stiff competition from Chinese rivals like BYD (OTCPK:BYDDY), as well as soaring rates on auto loans and an EV price war, notes SA analyst Wright's Research in Tesla: Prepare For A Macroeconomic Storm.
Under pressure elsewhere: Tesla's strategy in China is critical for its success in the near term, but Musk has a lot on his plate between his work at SpaceX and recently acquired Twitter. In fact, Fidelity Investments - which helped to finance his $44B takeover of the social media platform - said Twitter is now worth just one-third of what Musk paid for it after marking down the value of its equity stake. France has also threatened to ban Twitter across the EU if it doesn't follow the incoming European Digital Services Act, which goes into effect at the end of August. (12 comments)
| | Featured  Research shows that individual investors collectively underperform the stock market, because their decisions are often driven by emotions. We believe that as an investor you can do really well if you find opportunities based on 360-degree analysis - not hype. Seeking Alpha Premium's unparalleled stock coverage gives you the insights you need to stay ahead of the curve. With timely insights on stocks, ETFs, and more, you can track the investments that matter most to you. Plus, you can discover hidden gems and compelling new ideas with our exclusive stock ratings. Go Premium and experience its incredible value for yourself. Go Premium now | | Global Joining the business executive tour in China, JPMorgan (NYSE:JPM) CEO Jamie Dimon had his own comments to say about his relationship with the country, as well as company policy going forward. "We tend not to leave unless there is war or a civil war, and we're not predicting any of that here. There's always going to be risk," he told Bloomberg at the bank's annual Global China Summit in Shanghai. "Obviously, it's been a far more complex situation and national security will trump all other issues. Over time, there'll be less trade [in China, but] it'll take years for this thing to take place. This is not de-coupling, this is de-risking. The world's changed a little bit." | | Legislation Treasury yields continue to fall as a debt ceiling deal continues to advance on Capitol Hill. With a default nearly off the cards, the yield on the 10-year (US10Y) dropped 13 basis points on Tuesday to end the session at 3.69%, and slipped another 4 bps overnight to 3.65%. Legislation to lift the current $31.4T debt limit into 2025 and cap federal spending cleared the House Rules Committee last night by a 7-6 margin, sending it to the full House for debate and an expected vote on passage on Wednesday. "We are going to make sure that the votes are there, joining with our Republican colleagues, to get this bill over the finish line," House Minority Leader Hakeem Jeffries declared. "It will also avoid the country being in this hostage-taking situation for the rest of this Congress." (12 comments)
| | Tech "Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war." The sentence was featured in a new letter published by the Center for AI Safety, which was signed by OpenAI CEO Sam Altman, as well as executives from Microsoft (NASDAQ:MSFT), Google (GOOG, GOOGL) and several other companies and universities. OpenAI has received billions in funding from Microsoft, which has integrated the popular ChatGPT into many of its products and services. Earlier this month, a poll conducted by Reuters/Ipsos found that nearly two-thirds of Americans think AI poses a risk to humanity. In March, Elon Musk and Steve Wozniak also wrote a letter that called for a six-month pause in the development of many AI tools to develop new safety standards for the technology. (85 comments)
| | Today's Markets In Asia, Japan -1.4%. Hong Kong -1.9%. China -0.6%. India -0.5%.
In Europe, at midday, London -0.1%. Paris -0.5%. Frankfurt -0.3%.
Futures at 6:30, Dow -0.2%. S&P -0.3%. Nasdaq -0.1%. Crude -2.8% to $67.54. Gold -0.1% to $1975.40. Bitcoin -3.2% to $27,082.
Ten-year Treasury Yield -4 bps to 3.65%
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