Iran conflict latest: Trump pauses Iran energy plant strikes by 10 days
The lidar company I recommend, Hesai (HSAI), recently received a $40 million order for its sensors from a leading U.S. robotaxi company, which is what I assume is Waymo. Interestingly, Hesai’s co-founder, David Li, said he remained “conservative” about scaling up fully to autonomous vehicles. There was recently a fatal crash in a Xiaomi SU7 sedan in China, which caused Chinese regulators to tighten the regulations for self-driving vehicles. Interestingly, Hesai just raised $535 million in a secondary stock offering. The company now dominates lidar sensors and is effectively a monopoly.
If the FOMC only cuts 0.25% versus 0.5%, President Trump is expected to continue to bash Fed Chairman Jerome Powell. President Trump has been saying that he expects a “big cut” from the Fed on Wednesday. Specifically, Trump said, “I think you have a big cut” and “It’s perfect for cutting.”
One reason that the Fed may only cut the key interest rate 0.25% is that the Commerce Department on Tuesday reported that retail sales rose 0.6% in August, which was substantially higher than economists’ consensus estimate of a 0.3% increase. Excluding vehicle sales, retail sales rose an even more impressive 0.7% in August.
Online sales surged 2% in August. Back-to-school sales apparently boosted clothing and accessories 1% in August, as well as sporting goods that rose 0.8%. Fully nine of the thirteen categories surveyed increased in August, which is a very good sign that consumer spending is healthy. July retail sales were also revised up to a 0.6% increase, up from 0.5% previously reported.
In the meantime, the lack of investment in China is one reason that deflation has been widespread since May 2022. China’s National Bureau of Statistics announced that August retail sales rose at a 3.4% annual pace, which was below economists’ consensus forecast of a 3.9% annual increase. The National Bureau of Statistics also announced that industrial output grew at a 5.2% annual pace in August, which was also below economists’ consensus estimate of a 5.7% annual pace.
The pace of retail sales in China has steadily declined in the past three months, while the pace of industrial output has declined for two consecutive months. Fixed asset investment, or what we refer to as capital expenditures, has collapsed in China, but the worst sign is that property investment has been negative for years and declined at a 10% annual pace through August.