FINWIRES · TerminalLIVE
FINWIRES

China's Factory Activity Eases to Four-Month Low in July

By
China's Factory Activity Eases to Four-Month Low in July

China's manufacturing sector growth moderated to a four-month low in July, though output and new orders remained firmly in expansionary territory, according to the RatingDog China General Manufacturing PMI released on Monday.

The headline seasonally adjusted Purchasing Managers' Index (PMI) slipped to 50.9 from 51.7 in June. Despite the slowdown, the sector extended its current growth streak to match the joint-longest sequence in five years, matching the sequence from November 2023 to June 2024.

Growth was supported by stronger overall demand, higher international sales, new business channels, and improved product quality, which pushed new orders higher for the fourteenth consecutive month.

The expansion in new work and workloads prompted manufacturers to increase headcounts for the second straight month.

However, producers trimmed their input purchasing for the first time since November 2025, pointing to an ongoing accumulation of previously ordered stock.

Input cost pressures moderated, allowing output prices to remain broadly unchanged. Bolstered by strong demand, enhanced efficiency, and upcoming product launches, business sentiment remained optimistic regarding output levels over the coming year.

"Sustained new order growth and further easing of cost pressures provided support, while the return of new export orders to expansion was a positive signal," Yao Yu said. "However, the reduction in purchasing activity and ongoing accumulation of input stocks warrant attention."

Related Articles

Update: Wall Street Gains Amid Amazon Rally as July Ends Mostly Lower
US Markets

Update: Wall Street Gains Amid Amazon Rally as July Ends Mostly Lower

(Updates with market moves at the end of the day, along with weekly and monthly index changes.)US equity indexes rose Friday as Amazon (AMZN) surged 15% post earnings, while Wall Street closed out July mostly lower.The Nasdaq Composite rose 1% to 25,373.85, while the S&P 500 climbed 0.7% to 7,489.72. The Dow Jones Industrial Average gained 0.5% to settle at 52,485.03. Among sectors, consumer discretionary was a standout gainer with its 6.1% advance, while materials saw the steepest drop of 2.7%.For the month of July, the Nasdaq shed 3.2% and the S&P 500 edged 0.1% lower, the second consecutive month of losses for both measures. The Dow added 0.3% to log its fourth straight monthly gain.All three indexes posted weekly gains, with the Nasdaq up 1.6%. The S&P 500 and the Dow climbed 1.1% and 1%, respectively.Amazon was the best performer on the Dow and the S&P 500. Late Thursday, the e-commerce giant reported second-quarter earnings above Wall Street's estimates amid a 37% jump in its Amazon Web Services cloud computing business."Amazon's (second-quarter) print was exactly what bulls wanted," RBC Capital Markets said in an emailed client note. "AWS' accelerating 37% growth beat the bogey, the backlog meaningfully accelerated and AWS's margin flow-through would suggest AI may not be the (return on invested capital) depressant it's been made out to be."Apple (AAPL) slumped 7.1%, the worst performer on the Dow and among the biggest declines on the S&P 500. The company missed market estimates for iPad and services revenue in its fiscal third quarter.Apple supply chain-related concerns could persist into fiscal 2027, UBS Securities said, after Chief Financial Officer Kevan Parekh flagged a worsening supply backdrop.West Texas Intermediate crude oil was up 1.1% at $84.52 a barrel in Friday late-afternoon trade, while Brent rose 1.2% to $90.12. Both benchmarks are set to close out July with monthly gains of more than 20%, following two consecutive monthly declines.Iran hit two tankers trying to transit the Strait of Hormuz under US military escort, CNBC reported, citing state run PressTV.Iran's army said Friday that it struck strategic US assets and military bases in Kuwait and Bahrain, following Washington's attacks against Iran, according to a separate CNBC report that cited state media.In other corporate news, oil giants Exxon Mobil (XOM) and Chevron (CVX) reported year-over-year gains in their second-quarter results as supply disruptions in the Middle East boosted oil prices. Exxon shares fell 1%, while Chevron rose 2.4%.Newell Brands (NWL) jumped 9% as its second-quarter earnings unexpectedly rose year over year on the back of tariff refunds, while the consumer products manufacturer returned to revenue growth for the first time in more than four years.Treasury yields were higher, with the 10-year rate up 5.5 basis points at 4.72%, while the two-year rate rose 3.3 basis points to 4.26%.The Federal Reserve may need to pursue an aggressive tightening cycle if it doesn't raise interest rates immediately to bring inflation down, the three dissenters at this week's monetary policy meeting said Friday.The central bank's 12-member Federal Open Market Committee maintained its benchmark rate on Wednesday, staying on hold for the fifth time. However, three regional Fed presidents -- Beth Hammack of Cleveland, Neel Kashkari of Minneapolis and Lorie Logan of Dallas -- preferred to raise rates by a quarter percentage point.Spot gold declined 1.2% to $4,052.33 per troy ounce, while silver fell 1.6% to $58.08 per ounce.

Dow JonesNasdaq CompositeS&P 500$AAPL$AMZN$CVX$NWL$XOM
Roblox Downgraded to Neutral on Soft Third Quarter Outlook, Lack of Visibility, Wedbush Says
US Markets

Roblox Downgraded to Neutral on Soft Third Quarter Outlook, Lack of Visibility, Wedbush Says

Roblox (RBLX) has "near-zero forward visibility" as weakening player monetization triggered disappointing third-quarter guidance and the company withdrew its full-year outlook, Wedbush Securities said Friday.The video game platform projected Thursday third-quarter bookings in the range of $1.58 billion to $1.65 billion, down 14% to 18% year over year. Analysts in a FactSet survey expect $1.72 billion.The company reported bookings of $1.56 billion in the quarter ending June 30, up from $1.44 billion a year earlier and missing analysts' estimates of $1.60 billion.The brokerage said Roblox's second quarter miss stemmed from decelerating monetization among under-13 users in North America rather than an expected user growth decline, even as daily active users and engagement hours met consensus market expectations."With this backdrop, we can no longer justify our positive stance here and are therefore downgrading to neutral," Wedbush Analysts wrote. The firm downgraded its rating on Roblox stock to neutral from outperform and reduced the price target to $40 from $65.Shares of the company were down 27% in Friday afternoon trading and have fallen 56% this year.Roblox recently shifted its discovery strategy with algorithms focusing on long-term user retention, Chief Executive David Baszucki said during the earnings call, according to a FactSet transcript. "We have seen this impact monetization, primarily in the US under 13 cohort, and this has been exemplified by a lower frequency of impressions with games that emphasize short-term monetization rather than long-term retention."Chief Financial Officer Naveen Chopra said internal testing indicates long-term retention gains will "more than offset" the temporary hit to bookings."Monetization is soft while investment is rising, and beyond building better tools and incentives for developers to make more engaging, more monetizable 18+ content, much of the outcome is now out of Roblox's hands," Wedbush added.Earlier this year, the video game platform implemented an age-check feature for accessing chat, and by the end of the second quarter, 57% of global daily active users had age-checked.

$RBLX
Apple's Supply Woes Likely to Continue Into Fiscal 2027, UBS Says
US Markets

Apple's Supply Woes Likely to Continue Into Fiscal 2027, UBS Says

Apple's (AAPL) supply chain-related concerns could persist into fiscal 2027, UBS Securities said, after Chief Financial Officer Kevan Parekh flagged a worsening supply backdrop.Late Thursday, the company reported strong results for a supply-constrained fiscal third quarter amid momentum in iPhone sales. It, however, missed estimates for iPad and services revenue.The results were in-line with UBS' expectations, but analysts including David Vogt noted that Apple faces "increasingly more difficult gross margin headwinds and supply chain challenges," according to a note sent Friday.Fourth-quarter revenue is expected to grow 9% to 11% year over year, Parekh said on an earnings call late Thursday. That indicates a sequential slowdown from 16% growth in the June quarter, and missed Wall Street's then-consensus estimate."We expect the impact from supply constraints to increase significantly sequentially" in the fiscal fourth quarter, affecting iPhone, Mac, and iPad, Parekh told analysts.UBS reiterated its neutral rating on the stock with a price target of $296. Apple's shares closed 7.4% lower at $308.91 on Friday.Apple and other technology giants are grappling with a global shortage of memory chips, which has sent component prices higher. Apple recently increased prices for MacBooks and iPads.UBS expects component costs to pressure gross margins in the September and December quarters.Average selling prices for dynamic random access memory and NAND are likely to increase 30% quarter-over-quarter, which, combined with a ramp in iPhone volume, could lower the December-quarter gross margin to 45.9% from 50.1% in the three months ended June, Vogt said.The fiscal third quarter's margin benefitted from tariff refunds, the brokerage said.

$AAPL