China’s first-quarter gross domestic product grew rapidly. According to Reuters:
China’s economy grew at a slightly faster-than-expected pace of 6.8 percent in the first quarter, buoyed by strong consumer demand, healthy exports and robust property investment.
Resilience in the world’s second-largest economy will likely help keep a synchronized global recovery on track for a while longer, even as China faces rising trade tensions with the United States that could impact billions of dollars in business.
Netflix Inc. (NASDAQ: NFLX) posted incredibly strong earnings. According to 24/7 Wall St.:
Netflix reported first-quarter financial results after markets closed Monday. The company said that it had $0.64 in earnings per share (EPS) on $3.70 billion in revenue, compared with consensus estimates from Thomson Reuters that called for $0.64 in EPS on $3.69 billion in revenue. The same period from last year had $0.40 in EPS on $2.64 billion in revenue.
During the first quarter, global net adds totaled a new Q1-record of 7.41 million, up 50% year over year and ahead of the firm’s 6.35 million forecast. In the US, Netflix added 1.96 million memberships (compared with forecast of 1.45 million). Internationally, the firm added 5.46 million memberships.
Tesla Inc. (NASDAQ: TSLA) will shut down Model 3 production for several days. According to The Wall Street Journal:
Tesla said Monday it is shutting down Model 3 production for about a week as part of its planned downtime. A spokesman repeated the company’s past statement that shutdowns are “used to improve automation and systematically address bottlenecks in order to increase production rates.”
Coffee companies that do business in California continue to battle a legal judgment that says the product causes cancer. According to The Wall Street Journal:
The coffee industry is fighting the suggestion its products could cause cancer.
A Los Angeles judge’s recent ruling in a lawsuit over cancer labels has galvanized coffee brands and retailers, including Starbucks Corp., to push harder to avoid carrying the labels.
The companies say that trace amounts of the chemical acrylamide in their brew doesn’t justify a warning to consumers in California—an important market for food and beverage brands.
China will allow foreign car companies to take majority investments in operations that sell their vehicles in the world’s largest market. According to Bloomberg:
China will allow foreign automakers from Volkswagen AG to Ford Motor Co. to own more than 50 percent of local ventures, removing a two-decade restriction and giving a boost to global companies seeking to capture a greater share of the world’s largest car market.
In a move helping electric-car makers such as Tesla Inc., the ownership limits for new-energy vehicles will be removed this year, National Development and Reform Commission said in a statement on its website Tuesday. China will do away with the limit for commercial vehicles in 2020 and that for passenger vehicles in 2022.
Potential beneficiaries include companies from Daimler AG and BMW AG to General Motors Co. and Toyota Motor Corp., all set to find it easier to manufacture and do business in China. The country’s local auto makers meanwhile will be under increased pressure to speed up the building of their own brands.
The number of Chinese IPOs has dropped this year. According to CNBC:
Amid steeply declining initial public offering activity in China this year, there’s an ongoing push by the country to lure its tech companies to come back home to list.
There were only 35 IPOs in China during the first quarter, according to professional services firm EY. That’s a 74 percent decline compared to the same period in 2017, and it only included five tech listings, the study said.
Consequently, proceeds reaped from IPOs in the country fell 39 percent year-over-year.