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The World
Chinese leader Xi Jinping removed his handpicked foreign minister after less than seven months on the job, a surprise move that leaves more questions than answers around China’s black-box political system. Qin Gang’s removal comes after his mysterious absence from the public stage over the past month, a disappearance that has sparked speculation about his fate and cast a global spotlight on the Communist Party’s opaque governance of the world’s second-largest economy. (Wall Street Journal)
Qin had a meteoric rise from assistant foreign minister in 2017 to his appointment as Chinese ambassador to the US in 2021, foreign minister in December and as a member of China’s cabinet, the State Council, in March. But he abruptly vanished from public view on June 25 as he was preparing to attend a meeting of south-east Asian nations. The foreign ministry said at one point that his absence was due to “health reasons”, but it subsequently refused to give further explanation despite being constantly questioned about the matter at its daily press briefings. (Financial Times)
Qin’s replacement has been named, ending weeks of speculation, but it’s still not clear what prompted the former foreign minister’s removal. Wang Yi’s appointment makes him the most powerful person to hold the position in decades. (South China Morning Post)
China hits back against Western sanctions: The Communist Party is becoming less timid in its retaliation against American economic warfare. As America ratchets up its sanctions against China, which among other things make it impossible for Western chip companies to sell Chinese customers cutting-edge semiconductors and the machines to make them, new volleys from Beijing are coming thick and fast. Earlier this month, after China announced its latest export controls, this time on a pair of metals used in chips and other advanced tech, a former commerce ministry official declared that the measures were “just the beginning” of Chinese retaliation. On July 20th Xie Feng, China’s new ambassador to America, said that his country “cannot remain silent” in the escalating war over technology. A response, he hinted, was coming. (The Economist)
Climate change has played an "overwhelming" role in the heatwaves this month, according to an assessment by scientists. "European and North American temperatures would have been virtually impossible without the effects of climate change," said Izidine Pinto, one of the study's authors. Meanwhile, Greece battles to contain wildfires on the island of Rhodes for a seventh day, while in Italy wildfires forced the closure of Palermo airport, with severe storms causing damage and at least two deaths in the north of the country. Across the Mediterranean, wildfires killed 34 people in Algeria including 10 soldiers. (Reuters)
Indian politicians embrace influencers ahead of 2024 elections: As the campaign for the 2024 elections in India goes digital, social media influencers have become a powerful tool to try and shape voter behavior. Ahead of India’s union elections in 2024, political parties in the country are chasing social media influencers to sway voters. Prime Minister Narendra Modi’s Bharatiya Janata Party has held a series of meetups with influencers in recent months. Political parties not only chase celebrity influencers, but also seek out those with smaller, more niche audiences. (Rest of World)
Spain's snap election on Sunday yielded another hung parliament, which means no party or coalition has a majority of seats to form a government. So, what might happen next? Here are four scenarios, ordered from most to least likely. #1 — Election redo. #2 — Left-wing coalition government. #3 — Center-right minority government. #4 — Grand coalition. (GZERO Media)
The Education Department has opened a civil rights investigation into Harvard University’s legacy admissions policy, inserting the federal government directly into a fierce national debate about wealth, privilege and race after the Supreme Court gutted the use of affirmative action in higher education. The inquiry into one of the nation’s richest and most prestigious universities will examine allegations by three liberal groups that Harvard’s practice of showing preference for the relatives of alumni and donors discriminates against Black, Hispanic and Asian applicants in favor of white and wealthy students who are less qualified. (New York Times)
The advent of new Alzheimer's drugs has accelerated the race for new diagnostics: New Alzheimer’s drugs — Eisai/Biogen’s approved Leqembi and Lilly’s donanemab likely headed that way — are heating up demand for diagnostics to reveal who might do well on them, balancing modest benefits in slowing cognitive decline with serious side effects including brain bleeds. Now the standard confirmatory test looks for amyloid clumps on a PET scan, but if they’re visible, the disease has already progressed. Blood tests hold more appeal, particularly ones that aim for diagnosis before symptoms appear. Some tests used in clinical trials for Leqembi and donanemab have won FDA breakthrough device designation, though none is authorized yet. There’s still disagreement in the field about what to look for: amyloid? Tau? Phosphorylated tau? And where: cerebrospinal fluid? Blood? “Whereas in the CSF, it's a nice clean fluid that you can measure, in the blood it's a bit of a minestrone soup,” Mark Stearman of Roche said. (STAT News)
GE HealthCare CEO on advances in Alzheimer’s treatment: ‘A breakthrough moment for patients’. (CNBC)
Economy
Federal Reserve policymakers are poised to hike interest rates to the highest level in 22 years, while retaining a tightening bias that signals the possibility of an additional move later in the year. The Federal Open Market Committee is expected to raise rates a quarter point to the 5.25% to 5.5% range, an 11th increase since early 2022. It will release the decision at 2 p.m. in Washington. Chair Jerome Powell will hold a press conference 30 minutes later. (Bloomberg)
Stock Market Shrugs Off Recession Signals as Rally Builds: S&P 500 is trading at its highest level since April 2022 as hopes grow for a soft landing. (Wall Street Journal)
Real-Estate Investors Flee the U.S. for a Land of Fuller Offices: Some are finding a haven in Japan, where most workers have returned to the office and banks are eager to lend. Investment in Japanese office real estate hit over $4 billion in the first quarter of this year, more than double the figure a year earlier, according to JLL. In the U.S., pension funds and property developers are selling off their office holdings at a discount. Office vacancy rates are surging in major cities, hitting 16% in Manhattan and 32% in San Francisco in the second quarter, according to CBRE. Vacancy rates in Tokyo’s central business districts have stabilized around 6%. (Wall Street Journal)
China’s new labor challenge: Too many workers, not enough jobs. China’s economy is having more difficulty emerging from three years of “zero covid” lockdowns than expected, with the latest data showing that growth remains sluggish. The property market and the construction work it generates, responsible for about a quarter of economic growth, is in decline. Consumption remains tepid as households are cautious about big purchases. Indebted local governments are flirting with defaults. Together these economic challenges have caused a big spike in joblessness, particularly among young people. The unemployment rate for 16- to 24-year-olds hit a record 21 percent last month, although one economist thinks the real number may nearer to half. (Washington Post)
Technology
Tech Earnings:
Microsoft shares dip after quarterly revenue guidance misses expectations. Microsoft called for lower revenue guidance than analysts had predicted, partly because of weakness in the segment that contains Windows. Azure cloud revenue growth slowed to 26% from 27% in the previous quarter, surpassing analysts’ expectations. The company’s research and development costs declined for the first time since 2016. (CNBC)
Alphabet reports better-than-expected quarterly results driven by growth in cloud. Alphabet’s second-quarter revenue rose 7% from the year-earlier period. Cloud revenue climbed 28% year over year. The company said Ruth Porat is leaving the CFO role to become president and chief investment officer. (CNBC)
X Corp. is cutting ad prices as it tries to woo brands back to the Elon Musk-owned platform. The social network formerly known as Twitter is offering new incentives on certain ad formats in the U.S. and U.K. and warning brands that they will lose their verified status unless they reach certain spending thresholds, emails sent this week to advertisers and viewed by The Wall Street Journal show. The company, which makes most of its money from advertising, has struggled to draw new ad commitments under Musk’s ownership. (Wall Street Journal)
Spotify slumped to a €302mn loss last quarter as the group racked up costs axing podcasts and cutting jobs, overshadowing the record number of new users signed up during the period. After investing heavily in an ambitious push into podcasts during the coronavirus pandemic, Spotify has retreated over the past year as investors have grown impatient with the strategy. (Financial Times)
Snap Revenue Falls Amid Efforts to Retool Advertising Business. (Wall Street Journal)
It’s rare for corporate brands to become so intertwined with everyday conversation that they become verbs. It’s rarer still for the owner of such a brand to announce plans to intentionally destroy it. On Sunday, in the middle of a quiet summer weekend, Elon Musk decreed that Twitter’s product name would be changed to “X,” and that he is getting rid of the bird logo and all the associated words, including “tweet.” Musk’s move wiped out anywhere between $4 billion and $20 billion in value, according to analysts and brand agencies. (Bloomberg)
After bopping an asteroid 3 years ago, NASA will finally see the results: Christmas Day for scientists who study asteroids is coming in just two months when a small spacecraft carrying material from a distant rubble pile will land in a Utah desert. The return of the OSIRIS-REx sample container on September 24 will cap the primary mission to capture material from an asteroid—in this case, the carbonaceous near-Earth asteroid Bennu—and return some of its pebbles and dust to Earth. It has been a long time coming. This mission launched seven years ago and has been in the planning and development phase for over a decade. To say the scientists who have fought for and executed this mission are anxious and excited is an understatement. But there is an additional frisson with OSIRIS-REx, as scientists are not entirely sure what they've been able to pull away from the asteroid. (Ars Technica)
Smart Links
Rural America is the new hotbed in the AI race as tech giants spend billions to turn farms into data centers. (Insider)
FTC readies lawsuit that could break up Amazon. (Politico)
Lyft Looks for Buyers, Investors in Bikes Division. (Wall Street Journal)
Wells Fargo announces $30 billion buyback, shares rise. (CNBC)
Tired of proving you’re not a robot? Say goodbye to Captcha boxes. (Washington Post)