Your Daily Finance Odyssey 🚀✨

01/19/2024

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Global Finance
January 19, 2024

🌐✨ Welcome to our financial galaxy, where the orbits of finance and world news collide in a cosmic dance! Strap in for a journey through the ever-expanding universe of economic trends, market whims, and global happenings. Let's embark on this cosmic voyage together and explore the infinite possibilities that the financial galaxy holds! 🚀📈

In today’s email:

Markets

Home Sweet Low: Mortgage Rates Hit 7-Month Lows

Mortgage rates dip, luring buyers back to the housing market. The average 30-year loan rate dropped to 6.60% a week prior, the lowest in seven months. Homebuyers return as borrowing costs decrease by nearly 120 basis points from October highs. The rise in listings from homeowners contributes to increased inventory. However, experts warn it may not meet underlying demand. Mortgage applications surged by 10%, with an 11% increase in refinancing and a 9% climb in purchases. The shift is attributed to homeowners re-entering the market, driven by favorable rates. Home listings increased 9% YoY in January, offering potential buyers opportunities with lower rates. Bidding wars may intensify as activity picks up. Agents report increased competition, with homes receiving 20 to 30 offers. The housing market shows signs of recovery, driven by declining rates and growing inventory.

Sustainability

Record Highs: Global Coal Usage and Exports in 2023

Global coal-fired electricity generation reached record highs in 2023, totaling 8,295 terawatt hours through October, marking a 1% increase from the previous year. Additionally, thermal coal exports surpassed 1 billion metric tons for the first time, rising by 6.6% from 2022. Despite efforts to reduce fossil fuel usage, emissions from coal-fired electricity generation also set new records, totaling over 7.85 billion tons of carbon dioxide and equivalent gases. The concentration of coal mining, exports, and power generation remains predominant in Asia, with Indonesia leading as the top thermal coal exporter, followed by China as the largest thermal coal buyer. While other regions are phasing down coal use, the sheer volumes in Asia suggest continued reliance on coal for power generation despite growing renewable energy deployment.

Source: Reuters

Personal Finance

Gen Z Faces Economic Challenges: Embracing Side Hustles, and Navigating the Wealth-Building Journey

Gen Z and millennials, comprising those born between 1996 and 2012, face increased financial challenges compared to their parents. About 38% believe they encounter more difficulty in achieving financial security due to economic factors. With a higher cost of living, 53% of Gen Z workers have side hustles to meet monthly expenses, and many are not saving for the future. Inflation and soaring expenses contribute to the financial struggles, with 53% citing higher costs as a barrier to success. Student loan burdens and lower wages compound the challenges. A Prosperity Index study by Intuit found that Gen Z is hesitant about setting long-term financial goals, and two-thirds doubt they'll have enough for retirement. Despite obstacles, experts encourage prioritizing self-investment, debt reduction, and leveraging compound interest by saving for both short and long-term goals. Starting early offers Gen Z the advantage of time for building financial resilience. Financial habits such as consistent saving and patience are emphasized for long-term success.

Source: CNBC

Tech

Apple Removes Blood Oxygen Monitoring Feature from Apple Watches Amid Legal Battle with Masimo

Apple has decided to remove the blood oxygen monitoring feature from its Series 9 and Ultra 2 Apple Watch models in the U.S. amidst an ongoing legal battle over patents with medical technology company Masimo. The U.S. Court of Appeals for the Federal Circuit ruled against Apple, preventing the sale of these models. Analysts expected Apple to disable the feature rather than withdraw the devices from one of its major markets. The legal dispute, which may take a year to resolve, centers around allegations by Masimo that Apple infringed on its pulse oximetry technology.

The ruling follows a decision by the U.S. International Trade Commission (ITC) in December to halt imports of the devices. While Apple disagrees with the ITC decision, it plans to continue sales of the Series 9 and Ultra 2 models without the blood oxygen feature. Apple Watches account for about a quarter of the global smartwatch market, and the wearables segment, including the Apple Watch, contributed significantly to Apple's overall revenue in fiscal 2023, amounting to $39.84 billion. The legal dispute involves accusations of employee poaching and technology theft, with Apple countering Masimo's claims with its own patent infringement lawsuit.

Source: Reuters

M&A

Japanese Homebuilder Sekisui House Expands U.S. Footprint with $4.9 Billion Acquisition of MDC Holdings

Japanese homebuilder Sekisui House Ltd. has reached a $4.9 billion agreement to acquire MDC Holdings Inc., marking a significant step in its strategy to diversify beyond Japan. This move is considered one of the largest U.S. homebuilder acquisitions by a Japanese company. The trend of Asian buyers, particularly Japanese, in the U.S. homebuilding market is on the rise, with a focus on larger deals to address challenges posed by a declining population in Japan. The acquisition will provide Sekisui House with operations in densely populated states, including California, Texas, and Florida.

Sekisui House has been actively involved in the U.S. market since 2017, acquiring several U.S. builders. This includes Woodside Homes, Holt Homes, and Chesmar Homes. The latest deal with MDC Holdings is part of a broader wave of overseas investments by Japanese companies in recent years, driven by concerns about limited growth prospects domestically due to demographic shifts. Despite the challenges posed by currency dynamics, analysts anticipate continued activity by Japanese-based builders in the U.S. market as they seek to supplement lower domestic growth and address demographic challenges.

Source: Bloomberg

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