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πŸ–₯️ China Technology Rebounds From 25% Decline. $25M+ VC Funding.

Impact Capital Markets #91 looks at our China Technology Index, major impact deals, M&A, and upcoming economic releases.

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πŸ“ˆ Today's Global Economic Update: The UK economy grew by 0.2% YoY in the first quarter of 2024. The services and production sector recovered, but construction declined by 0.7%. Despite increases in public spending, household consumption, business investment, exports, and imports saw declines compared to the previous quarter.

🌱 Deal of the Day: Dendra Systems, an Eco-Tech restorations company, raised a $15.7M Series B to expand globally and support the continuous development of its AI-enabled ecology platform.

What's New?

πŸ–₯️ China Technology. China technology index recovers from 25% decline
πŸ’° Funding. Climate-tech and ecological restorations
πŸ’Ό M&A. Semi-conductors and ERP software
πŸ“… Economics. US inflation data, retail sales, balance of trade + more

πŸ–₯️ China Technology Index Recovers From 25% Decline

HolonIQ’s China Technology index has rebounded from losses exceeding 25% in Q1 2024 to achieve a 3% gain over the past year. Over the past three months, the index recorded 30% growth. In Q4 2023, the introduction of draft regulations for the online gaming sector caused a significant stock decline, particularly impacting Tencent Holdings ($456B MCap). These regulations intensified the downward pressure on an already declining index and sparked concerns among investors that China's regulatory crackdown on the technology industry was not over. This created uncertainty about the operating environment for these firms. However, shortly after, the Chinese government lifted these restrictions.

In Q1 2024, the government announced measures to ramp up the promotion of its technology sector, improving its outlook. China will support overseas institutions in issuing yuan bonds in the country and encourage tech companies to raise money via bond issuances. The government also announced measures to facilitate foreign investment in Chinese tech firms via an inbound investment scheme, and the Central Bank has unveiled plans to set up a 500 billion yuan ($70 billion) re-lending program to back the science and technology industries.

Positive earnings reported over the last month have also pushed the index towards recovery. Meituan ($97B MCap) saw its price increase by 21% in the last month as it beat its quarterly revenue expectations for 4Q 2024. Foxconn ($65B MCap) reported record sales for the month of April and expected a rise in second-quarter revenue.

πŸ’° Funding

🌱 Dendra Systems, a UK-based company that specializes in technology-driven ecological restoration, raised a $15.7M Series B from Zouk Capital to expand into new markets and support the development of its AI-enabled ecology platform.

🌞 Electricity Maps, a Denmark-based climate tech company, raised $5.4M from Transition and Revent to expand its operations and business reach.

πŸ’Ό M&A

πŸ”Œ Mobix Labs, a California-based semiconductor company, acquired RaGE Systems, a Massachusetts-based wireless solutions provider.

πŸ’° Black Mountain Software, a Montana-based government finance software company, acquired Fiscalsoft, a Kentucky-based software solutions provider.

πŸ“… Economic Calendar

US Inflation Data, Retail Sales, Balance of Trade + More

Tuesday, May 14th 2024

πŸ‡¬πŸ‡§ UK Employment Data, March
πŸ‡©πŸ‡ͺ Germany ZEW Economic Sentiment Index, May
πŸ‡ΊπŸ‡Έ US PPI, April

Wednesday, May 15th 2024

πŸ‡ΊπŸ‡Έ US Core Inflation Data, April
πŸ‡ΊπŸ‡Έ US Inflation Data, April
πŸ‡ΊπŸ‡Έ US Retail Sales Data, April

Thursday, May 16th 2024

πŸ‡ΊπŸ‡Έ US Building Permits (Preliminary), April
πŸ‡―πŸ‡΅ Japan GDP Data (Preliminary), Q1
πŸ‡¨πŸ‡³ China Industrial Production Data, April
πŸ‡¨πŸ‡³ China Retail Sales Data, April

Friday, May 17th 2024

πŸ‡―πŸ‡΅ Japan Inflation Data, April
πŸ‡―πŸ‡΅ Japan Balance of Trade Data, April

Monday, May 20th 2024

πŸ‡¦πŸ‡Ί Australia Westpac Consumer Confidence Index, May
πŸ‡¦πŸ‡Ί Australia RBA Meeting Minutes

Tuesday, May 21st 2024

πŸ‡¨πŸ‡¦ Canada Inflation Data, April
πŸ‡―πŸ‡΅ Japan Balance of Trade, April

Wednesday, May 22nd 2024

πŸ‡¬πŸ‡§ UK Inflation Data, April
πŸ‡ΊπŸ‡Έ US FOMC Minutes

Thursday, May 23rd 2024

πŸ‡©πŸ‡ͺ Germany HCOB Manufacturing PMI (Flash), May
πŸ‡―πŸ‡΅ Japan Inflation Data, April

Friday, May 24th 2024

πŸ‡¬πŸ‡§ UK Retail Sales Data, April
πŸ‡ΊπŸ‡Έ US Durable Goods Orders Data, April

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