Syz the moment

Source: Bloomberg

Warren Buffett’s Berkshire Hathaway on Monday unveiled an $814mn investment in three US housebuilders, a bet on a sector that has benefited from dearth of supply. Berkshire disclosed it had purchased 6mn shares of DR Horton, worth about $726mn at the end of the second quarter, as well as 152,572 shares in Lennar and 11,112 shares of NVR. Shares of housebuilders and companies who service the industry have rallied this year after a difficult 2022 during which higher interest rates crimped demand. However, while higher mortgage rates have cooled the pace of existing homes sales, new homes sales have remained surprisingly robust owing to the limited supply.

Only a small fraction of cases have taken longer to get decision. So odds are pretty good. See below: Source: Bloomberg, Eric Balchunas

Japan Q2 GDP improves to 1.5% QoQ vs 0.8% expected and 0.1% prior, meaning Japan grows 6.0% on annualized basis, far more than expected (+2.9% yoy). However, some details of the report weren’t as impressive as the headline. As pointed out by analysts in CNBC report, nearly all of the increase in output was driven by a 1.8%-pts boost from net trade. That marked the second-largest contribution from net trade in the 28-year history of the current GDP series, with only the bounce back in exports from the first lockdown at the beginning of the pandemic providing a larger boost. Exports rebounded 3.2% from the previous quarter — largely driven by the spike in car shipments — while imports plunged 4.3% over the time period. Source: Bloomberg, HolgerZ, CNBC

Source: Elements / Visual Capitalist

China’s central bank unexpectedly cut key policy rates for the second time in three months on Tuesday, in a fresh sign that the authorities are ramping up monetary easing efforts to boost a sputtering economic recovery. This move opens the door to a potential cut in China’s lending benchmark loan prime rate (LPR) next week.Earlier this morning, China reported big data miss in July. Retail sales rose by 2.5% in July from a year ago, below expectations for a 4.5% increase, according to analysts polled by Reuters. A spokesperson for the National Bureau of Statistics said the bureau is suspending the youth unemployment number release due to economic and social changes, and is reassessing its methodology. Source: CNBC

These chips are crucial for building artificial intelligence software, joining a global AI arms race that is squeezing the supply of Silicon Valley’s hottest commodity. The Gulf powerhouses have publicly stated their goal of becoming leaders in AI as they pursue ambitious plans to turbocharge their economies. But the push has also raised concerns about potential misuse of the technology by the oil-rich states’ autocratic leaders. According to people familiar with the moves, Saudi Arabia has bought at least 3,000 of Nvidia’s H100 chips — a $40,000 processor described by Nvidia chief Jensen Huang as “the world’s first computer [chip] designed for generative AI” — via the public research institution King Abdullah University of Science and Technology (Kaust).

Source: Barchart