RTX Still Struggling to Deliver Navy's Top Missile Interceptor, Pentagon Contract Agency Says
'Supplier challenges still hamper deliveries' of the Standard Missile-6 under a contract that's now expected to be completed a year late, the Defense Contract Management Agency said in a statement to Bloomberg News. Contract performance 'has been poor versus expectations,' it said.
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CNBC
24 minutes ago
- CNBC
CNBC's The China Connection newsletter: New bets, old worries
Even if AI and robots offer an exciting future, the daily grind for many in China holds more worries. Among the trickle of gloomy headlines this summer, one stirred so much online attention that a state-run social media account published a commentary on Saturday to allay fears. The concern was that a court ruling kicking in on Sept. 1 would force struggling businesses to buy national insurance for all employees, amid frequent talk of pay cuts and merciless competition. But in reality, the ruling isn't something new. "It's not that the government changed the policy, it's that [many businesses] hadn't followed the policy," said Wen Biao, general manager at Shenzhen-based Qianhe Technology Logistics, in Mandarin remarks translated by CNBC. It's a grey area that wasn't enforced, enabling workers to take home more pay or businesses to spend less on labor. China's "social" insurance program includes health and retirement coverage, which means the cash is locked up for medical events or retirement decades away. The renewed attention has fueled discussions on low wages and frequent overtime work, adding to depressed sentiment. In late July, the jobs outlook fell to a record low, according to a quarterly survey by China's central bank. That prompted Morgan Stanley to cut its reading on social sentiment in China to the lowest level since the beginning of the Covid-19 pandemic. Consumer sentiment in the U.S. has also deteriorated, according to a preliminary read for August compiled by the University of Michigan. While American consumers are not bracing for the worst, as they were at the escalation in trade tensions in April, many still expect inflation and unemployment to worsen, the report said. Trade tensions persist, despite the U.S. and China last week extending a trade truce until mid-November. But that still leaves tariffs of around 55% on most Chinese exports to its largest trading partner. China's stronger-than-expected export growth has obscured insufficient domestic demand, said Bruce Pang, adjunct associate professor at the Chinese University of Hong Kong business school. It hasn't taken long for those issues to appear. In just the last several days, data releases for July showed that new bank loans unexpectedly dropped for the first time in 20 years. Retail sales, industrial and investment figures missed expectations — underscoring a still unresolved real estate slump — that Chinese Premier Li Qiang acknowledged in a government meeting Monday. Li called for more effective measures to address the property market, stabilize market expectations and ensure social stability. China's property and construction sector once accounted for more than a quarter of China's GDP and is still the main driver of household wealth. Local governments have also struggled financially after losing revenue from land sales to developers. To address the real estate challenge, Luo Zhiheng, chief economist at Yuekai Securities, proposed Monday that the central government create a 2 trillion yuan ($280 billion) fund to finish building qualified real estate projects. He also called for more financial support for local governments. Despite the headwinds, Beijing has kept its official growth target at around 5% for the year — a goal Premier Li reiterated this week. Pang from the Chinese University of Hong Kong said the economy is still able to achieve the goal, despite some loss of momentum. In his view, business confidence was worse last year, and now it's just a matter of time for policy to take effect. The challenge is that the external situation may disrupt those plans, he said, noting that any additional stimulus hinges on uncertainty around U.S.-China trade tensions and a possible Federal Reserve interest rate cut. But as China's domestic economy slogs through a transition away from real estate, its companies are turning overseas. For Wen of Qianhe Technology, his main business in logistics and overseas e-commerce has been hit by the U.S.-China tensions. He doesn't expect a resurgence of orders, unless tariffs drop significantly before the trade truce expires in November. "It's not just China; the entire world is in a state of unrest," he said. But he's still upbeat. To him, the tensions have just sped up a generational opportunity for Chinese businesses to invest in factories abroad — much like how Singapore, Hong Kong and Taiwan firms once shifted manufacturing to the mainland after China joined the World Trade Organization in 2001. James Peng, CEO of said that the robotaxi company is racing towards profitability as its Gen-7 robotaxi gets cheaper to make. Joe Ngai, Greater China chairman at McKinsey, said Chinese companies are increasingly producing products that have a global market, like Labubus, TikTok, and Black Myth: Wukong — but there's some way to go before they become 'truly global'. Robin Xing, chief China economist at Morgan Stanley, said investors are just shrugging off China's soft data numbers and policy laws. He added that the upcoming fourth Plenum meeting will be much more important than a conventional cyclical parliamentary meeting. Shein's IPO saga continues. The fast-fashion giant is considering moving its base back to China from Singapore as it tries to court Beijing's approval for its long-awaited IPO, Bloomberg reported on Tuesday. Tencent has enough AI training chips. That's what its President Martin Lau told investors last week, after the company reported AI-driven improvements helped boost marketing services revenue by 20% in the second quarter. China's electric car investments ramp up. For the first time, the industry has invested more in factories overseas than at home, according to a report published Monday by U.S.-based consulting firm Rhodium Group. China and Hong Kong stocks inched higher amid mixed trading in the region on Wednesday as investors parsed China's loan prime rate decision. Hong Kong's Hang Seng index climbed 0.19%, while the mainland's CSI 300 added 0.99% after China left its key lending rates steady in August for a third straight month, matching market forecasts. The mainland benchmark is up over 8% year to date, data from LSEG 27: July industrial profits
Business Insider
an hour ago
- Business Insider
Even Russia has had enough of some Chinese products
Russia's trade boom with China is losing steam, with a top Moscow official warning that the country's markets are already oversupplied with some Chinese goods. "In the current year, we are recording a certain decline in mutual trade," said Anton Alikhanov, Russia's industry and trade minister, on Tuesday at a business forum. "We also note the gradual saturation of the market with Chinese products in certain market segments, as well as internal economic processes both in Russia and in China," Alikhanov said. Sanctions and volatility in commodity markets have also weighed on flows, he said. From record highs to slowdown Trade between the two countries surged after Russia's full-scale invasion of Ukraine in 2022, as China filled the gap left by Western brands and Moscow diverted energy exports eastward. Turnover in Russia-China trade rose 29% in 2022 and 26% in 2023, reaching a record $245 billion in 2024. But growth slowed to just 2% last year, and in the first seven months of 2025, trade fell about 8% year-on-year to $125.8 billion. Alikhanov warned that the rapid growth of past years is unlikely to return. "In the medium term, we should expect more moderate growth rates of mutual trade than before," he said. Chinese companies have dominated Russia's consumer markets, especially cars, where they quickly took the majority of new sales after Western firms exited. But the wave of imports has also raised unease in Moscow. This year, the Kremlin increased tariffs on Chinese-made cars — a move mirroring protective trade steps in the US and Europe against Chinese overcapacity. That step has already slowed flows: Exports of all Chinese goods to Russia dropped 8.4% in the first half of 2025. Alikhanov suggested that future cooperation should focus less on consumer imports and more on industrial investment. "I believe that in the long term, the most successful initiatives will be those that involve investment in joint production, technology transfer and the introduction of advanced technologies," he said. Russia's energy lifeline falters But it's not just consumer trade that is under strain — Russia's energy exports to China have also come under pressure due to lower global oil prices and tighter US sanctions on tankers carrying Russian crude. That slowdown is rippling through the wider economy, with GDP growing just 1.1% in the second quarter — down from 1.4% in the first quarter and sharply lower than 4% a year earlier. "Falling Chinese demand for Russian raw materials — particularly crude oil — has intensified fiscal pressure on Moscow by eroding the tax base tied to energy exports, a key pillar of federal revenues," wrote Maciej Kalwasiński, a senior fellow at the China Department at the Centre for Eastern Studies in Poland, last week. He added that the overall contraction in bilateral trade exerts a "tangible negative impact" on the Russian economy. "This further strains Russia's ability to sustain wartime spending, especially since Russia's economic growth rate has slowed sharply since the beginning of 2025," wrote Kalwasiński.
Business Insider
an hour ago
- Business Insider
Baidu (BIDU) Is About to Report Q2 Earnings Today. Here's What to Expect
Chinese search engine Baidu (BIDU) is scheduled to announce its results for the second quarter of 2025 on Wednesday, August 20. BIDU stock has risen about 7% year-to-date, supported by strong first-quarter earnings and growth in its AI and cloud businesses. However, intense competition in China and weakness in Baidu's advertising business remain key concerns. Wall Street analysts expect the company to report earnings of $1.84 per share for Q2 2025, down 37% from the prior-year quarter. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Meanwhile, analysts expect revenues of $4.57 billion, reflecting a 2.6% year-over-year decrease, according to data from the TipRanks Forecast page. Importantly, Baidu has missed the consensus EPS estimates just once in the last nine quarters. Recent News Ahead of Q2 On August 4, Baidu announced a partnership with U.S. ride-hailing company Lyft (LYFT) to bring its autonomous taxis to Europe, marking a step in its global push into driverless mobility. The companies plan to launch robotaxis in the U.K. and Germany starting in 2026, with ambitions to expand to 'thousands' of vehicles across Europe in the following years. In July, Uber (UBER) and Baidu joined hands to deploy thousands of Baidu's Apollo Go autonomous vehicles on the Uber platform. Under this multi-year partnership, initial rollouts are expected in global markets outside the U.S. and mainland China. Analyst's Take Ahead of Q2 Results Heading into Q2 FY25 earnings, Benchmark's Top analyst Fawne Jiang reiterated a Buy rating on Baidu with a $120 price target. She expects Baidu Core advertising to face continued pressure from market share challenges and the faster rollout of GenAI-generated content in search results. Jiang cut Q2 and full-year Core ad growth forecasts to -16% and -13% year-over-year, noting that a near-term recovery in search and advertising is uncertain. On the positive side, Jiang highlighted Baidu's progress in autonomous driving, citing its recent partnership with Uber to deploy Apollo Go globally. She said this is an early but key step that could help lift the stock price. Options Traders Anticipate a Minor Move Using TipRanks' Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don't worry; the Options tool does this for you. Indeed, it currently says that options traders are expecting a 5.71% move in either direction. Is BIDU Stock a Buy, Sell, or Hold? Wall Street is cautiously optimistic on Baidu stock, with a Moderate Buy consensus rating based on nine Buys and five Holds. The average BIDU stock price target of $102.52 indicates about 13.75% upside potential from current levels.
