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China’s exports record biggest decline in more than 3 years (3 min read)

China’s trade data for June showed a sharp decline in both exports and imports. The exports plunged 12.4% from a year ago, much worse than expectations for a 9.5% drop and the previous month’s 7.5% annual decline. The imports also fell 6.8%, worse than forecasts for a 4% drop and the previous month’s 4.5% annual decline. These trade data reflect China’s pressure due to shrinking global demand and high inflation in developed countries. Some experts believe China will still face challenges in the second half of 2023 due to these factors.

China's economic woes may help lower U.S. inflation (2 min read)
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This article argues that China's economic struggles, including the risk of deflation and a weak currency, could indirectly benefit the US by helping to bring down inflation. The weak Chinese economy leads to falling prices, which can discourage consumer spending and investment. As China is a major exporter and industrial hub, its economic woes impact global markets, including the US. The country's weak currency lowers the prices of its exports, including commodities, which may in turn put downward pressure on prices in the US.

Elon Musk launches his new company, xAI (2 min read)
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Elon Musk has announced the launch of a new AI company called xAI. The company will focus on the mathematics of deep learning and aims to take AI to the next level. Its team includes former members of DeepMind, OpenAI, Google Research, Microsoft Research, Twitter, and Tesla, who have worked on projects like AlphaCode, GPT-3.5, and GPT-4. It was reported that Musk has acquired thousands of GPUs from Nvidia and plans to create a new AI tool called TruthGPT that is not politically correct. Musk will reveal more details in a live chat on Friday.

Why Nvidia is still seen as worth more than $1 trillion (3 min read)
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Despite geopolitical tensions between the US and China, investors remain optimistic about Nvidia's performance in the generative AI market. Nvidia's market cap has exceeded $1 trillion after its stock surged about 200% this year. Analysts project continued growth and positive AI-related news will likely support the company's momentum. Nvidia’s upward revision of guidance and expectations of strong earnings have also further bolstered investor confidence in the company.

The True Costs of ETF Ownership (3 min read)
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The actual cost of an ETF includes not only just the total expenses ratio but also the bid/ask spreads, and premiums and discounts over NAV as well. This article compares different ETFs from Vanguard and iShares and finds that they are mostly similar in cost, but Vanguard has some advantages in terms of index breadth and securities lending. It also shared a few ETF trading best practices to avoid market volatility, such as using limit orders or do not trade when the market just opened or is about to close.

2 ETFs to Trade Biden’s New Industrial Strategy (4 min read)
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The article discusses two ETFs, First Trust RBA American Industrial Renaissance ETF (AIRR) and Invesco S&P SmallCap Industrials ETF (PSCI), that invest in small-cap industrial companies in the US. It argues that both ETFs are well-positioned to benefit from the Biden administration’s policies and spending on US industrial infrastructure, which aim to revive the manufacturing sector and create business clusters. More on the comparison between AIRR and PSCI is available in this article.

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Thanks,
Thomas

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