Xi's Price-War Campaign Creates a Buzz in China's Stock Market
The term ' anti-involution ' has cropped up in government documents over the past year, but gained prominence earlier this month when President Xi Jinping chaired a high-level meeting that pledged to regulate 'disorderly' price competition. It refers to efforts to root out China's industrial malaise, marked by cutthroat price wars and overcapacity that have hurt profitability in sectors ranging from solar, new energy vehicles to steel.
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'That's the million-dollar question': Wall Street divided on Fed rate cuts as tariff uncertainty lingers
After a week marked by trade flare-ups, record-breaking stock market highs, and trillion-dollar valuation milestones for AI darling Nvidia (NVDA), Wall Street remains locked in a heated debate over the Federal Reserve's next move. While some firms like Goldman Sachs have pulled forward their expectations for a September rate cut, others have warned that tariffs and lingering inflation risks may force the Fed to hold off until later this year or possibly next. "This is the million-dollar question," Neel Mukherjee, chief investment officer at TIAA Wealth Management, told Yahoo Finance when asked about the Fed's rate-cutting path. "Inflation still hasn't been impacted by these tariffs, which has surprised a lot of people ... but the Fed is focused on inflation because they're worried about goods inflation. And that will accelerate." Economists have echoed concerns that the risk of higher prices still lingers, a view shared by many on Wall Street. Investors will get their next major test early this week when the latest Consumer Price Index (CPI) is released. While CPI has been trending lower on a monthly basis since Trump's initial tariff announcements in April, uncertainty around the inflation outlook remains. Meanwhile, ongoing political pressure is adding fuel to the fire. Last week, President Trump continued his public campaign for lower rates, calling Federal Reserve Chair Jerome Powell "Too Late Powell" and demanding deep rate cuts to ease the burden on consumers. "Our Fed Rate is AT LEAST 3 Points too high," Trump said in a Truth Social post on Wednesday. "LOWER THE RATE!!!" Read more: How much control does the president have over the Fed and interest rates? Michael Kantrowitz, chief investment strategist at Piper Sandler, argued that while Trump's call for deep rate cuts may be extreme, the broader message — that policy remains too restrictive for many Americans — holds weight. "Just because the overall economy and market, which is increasingly a reflection of the largest businesses and wealthiest consumers, appears to be chugging along doesn't mean that lower rates aren't warranted," Kantrowitz said in a note to clients on Wednesday. He added that scars from the 2022 inflation shock have left policymakers overly cautious. "This is recency bias at its best," he said. "We are not in the COVID backdrop any longer and tariffs as an inflation risk akin to the 2022 experience is exaggerated. Tariffs are a narrow tax, likely to lead to demand destruction, substitution and pockets of price hikes rather than broad-based inflation." Kantrowitz pointed to the weakening housing market as a key reason the Fed should act: "Historically speaking, every single broad-based improvement in the US economy began with an improvement in housing, and for that to occur we'll need to see lower rates." That message appears to be resonating in some corners of Wall Street. Goldman Sachs recently pulled forward its forecast for the next rate cut to September, up from its previous December projection. The firm now expects three 25-basis-point cuts in September, October, and December. The bank cited weaker-than-expected tariff impacts and a softening labor market as key drivers behind the shift. But not everyone is convinced a September cut is a done deal. Jeff Schulze, head of economic and market strategy at ClearBridge Investments, said he sees a scenario in which the Fed delays easing until later in the year. "The Fed may sit on their hands longer than what's currently being priced into the markets," he told Yahoo Finance. "And if that happens, companies that don't have as many offsets to the tariff pressures may continue to struggle in this environment." Read more: What experts say about the possibility of additional rate cuts Steve Sosnick, chief strategist at Interactive Brokers, echoed that uncertainty, arguing that the inflation picture remains too murky, especially with tariffs in flux. "We can't know [how tariffs will be baked in] because the numbers keep changing," he said. "There's too much uncertainty for the Fed to really move." Even the Fed itself appears divided. Minutes from its June policy meeting revealed a split committee, with "most" officials supporting at least one rate cut this year while "a couple" signaled they'd be open to moving as early as July. Others preferred to hold rates steady through year-end. That policy limbo is already showing up in markets, with traders pricing in a 60% chance of a September rate cut, according to the CME FedWatch tool. The odds of the Fed holding steady in July are near 100%. Allie Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at Sign in to access your portfolio
Yahoo
an hour ago
- Yahoo
4 No-Brainer Blue Chip Stocks to Buy With $2,000 Right Now
Blue chip companies have established sound business models that can deliver solid returns over time. These companies often operate in stable industries with steady demand for their services. They also tend to display a strong economic moat through pricing power and barriers to entry. 10 stocks we like better than Berkshire Hathaway › Investing in the stock market is one way to build enduring, long-term wealth. As an investor, you could choose to invest in high-flying growth stocks, dividend stocks that provide passive income, or more conservative investments that can preserve and grow your investments steadily over time. One strategy you can consider is investing in blue chip companies. These companies have withstood the test of time thanks to sound business models that have led to solid returns for patient investors. Blue chips typically offer reliable dividends and steady long-term growth, making them appealing to both seasoned investors and newcomers seeking to establish a solid financial foundation. Here are four blue chip stocks you can invest in today. Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) has thrived under the leadership of its longtime CEO, Warren Buffett. Since 1965, Buffett has led the conglomerate to 20% annualized returns, or enough to turn a $100 investment into $5.5 million today. So when Buffett announced earlier this year he was stepping down at the end of 2025, it took the wind out of the sails of Berkshire Hathaway stock, which is down 12% since the announcement in early May. However, Berkshire Hathaway is a widely diversified conglomerate with holdings across numerous industries, including insurance, transportation, materials, consumer goods, and energy. Its insurance operations help generate a steady stream of cash flow, which it can invest in treasuries or equities, or use to acquire companies outright. What makes Berkshire appealing right now is its massive cash pile and positive tailwinds from higher interest rates. The Federal Reserve is cautious about cutting interest rates due to concerns about inflation stemming from higher tariffs. This has resulted in rates staying "higher for longer," and Berkshire has benefited to the tune of $2.9 billion in interest income in the first quarter. Berkshire will be under new leadership, led by CEO Greg Abel, with its investment portfolio managed by Todd Combs and Ted Weschler, the investing lieutenants tapped by Buffett and the late Charlie Munger over a decade ago. While the uncertainty around its future remains, I think it's well-capitalized and diversified enough that it's a buy at today's price. Progressive (NYSE: PGR) is the second-largest automotive insurer in the United States. What sets this blue chip company apart is its disciplined underwriting, strong brand, and direct-to-consumer model. The company relies heavily on technology and data to accurately price risk and was one of the original companies to adopt usage-based insurance, known as telematics. This approach utilizes driver data to price policies, which is one reason the company has outperformed its competitors. Progressive's track record of navigating underwriting cycles while maintaining profitability distinguishes it. Going back 23 years, the company's combined ratio has averaged 92%, which is significantly lower than the industry average of 100%. Put differently, Progressive has earned an average of $8 in underwriting profit for every $100 in premiums. As a stock, Progressive offers defensive characteristics with upside. Insurance is a stable industry that enjoys steady demand, and Progressive has demonstrated its ability to outperform its peers in underwriting profitability. The company is also well-positioned to perform if inflation and interest rates were to remain elevated. That's because it has pricing power, allowing it to adapt to rising costs, and it also earns interest on float (the cash it collects from premiums but hasn't yet paid out in claims). Its stellar long-term performance and ongoing strong underwriting make Progressive an excellent blue chip stock to consider adding to your portfolio today. Chubb (NYSE: CB) is one of the world's largest publicly traded property and casualty insurers, recognized for its underwriting discipline, global diversification, and robust balance sheet. It operates across commercial and personal lines, with a reputation for serving high-net-worth individuals and complex corporate risks. Its conservative approach to risk, coupled with a broad international footprint, has enabled it to weather economic cycles well. Chubb has been a solid dividend stock for investors, growing its payout for 32 consecutive years. With a yield of 1.4% and an average annual total return of 11.7% over the past two decades, the company offers investors a balanced combination of income and stock price appreciation. It also enjoys the benefits that Progressive does, such as pricing power and interest income, making it another solid blue chip stock to consider owning today. S&P Global (NYSE: SPGI) plays a key role in markets. The company is perhaps best known for its S&P 500 index, but it also provides credit ratings, data, and analytics. Barriers to entry make it difficult to break into the credit ratings space, and S&P Global holds a 50% share of this market. S&P Global's business model is resilient and scalable. Credit rating demand rises with bond issuance, while its index and data segments enjoy recurring fees from ETF licensing and subscriptions. The company also has low capital requirements, which enables it to enjoy high margins, recurring revenue, and a global reach. The company has raised its dividend payout for 53 years, making it an exclusive member of the Dividend Kings club. While it offers a modest dividend yield of 0.7%, when combined with its stock price appreciation, S&P Global has returned 15.3% annually over the past two decades. For investors, S&P Global offers growth and a wide moat along with steady cash flows, making it a quality blue chip stock to own today. Before you buy stock in Berkshire Hathaway, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Berkshire Hathaway wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $671,477!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,010,880!* Now, it's worth noting Stock Advisor's total average return is 1,047% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of July 7, 2025 Courtney Carlsen has positions in Berkshire Hathaway and Progressive. The Motley Fool has positions in and recommends Berkshire Hathaway, Progressive, and S&P Global. The Motley Fool has a disclosure policy. 4 No-Brainer Blue Chip Stocks to Buy With $2,000 Right Now was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
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We're Not Very Worried About Phoenix New Media's (NYSE:FENG) Cash Burn Rate
Just because a business does not make any money, does not mean that the stock will go down. For example, although software-as-a-service business lost money for years while it grew recurring revenue, if you held shares since 2005, you'd have done very well indeed. Having said that, unprofitable companies are risky because they could potentially burn through all their cash and become distressed. So should Phoenix New Media (NYSE:FENG) shareholders be worried about its cash burn? For the purpose of this article, we'll define cash burn as the amount of cash the company is spending each year to fund its growth (also called its negative free cash flow). Let's start with an examination of the business' cash, relative to its cash burn. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. A cash runway is defined as the length of time it would take a company to run out of money if it kept spending at its current rate of cash burn. In March 2025, Phoenix New Media had CN¥975m in cash, and was debt-free. In the last year, its cash burn was CN¥50m. That means it had a cash runway of very many years as of March 2025. While this is only one measure of its cash burn situation, it certainly gives us the impression that holders have nothing to worry about. Depicted below, you can see how its cash holdings have changed over time. See our latest analysis for Phoenix New Media We reckon the fact that Phoenix New Media managed to shrink its cash burn by 24% over the last year is rather encouraging. Having said that, the flat operating revenue was a bit mundane. Considering the factors above, the company doesn't fare badly when it comes to assessing how it is changing over time. Of course, we've only taken a quick look at the stock's growth metrics, here. This graph of historic earnings and revenue shows how Phoenix New Media is building its business over time. There's no doubt Phoenix New Media seems to be in a fairly good position, when it comes to managing its cash burn, but even if it's only hypothetical, it's always worth asking how easily it could raise more money to fund growth. Issuing new shares, or taking on debt, are the most common ways for a listed company to raise more money for its business. One of the main advantages held by publicly listed companies is that they can sell shares to investors to raise cash and fund growth. By looking at a company's cash burn relative to its market capitalisation, we gain insight on how much shareholders would be diluted if the company needed to raise enough cash to cover another year's cash burn. Since it has a market capitalisation of CN¥192m, Phoenix New Media's CN¥50m in cash burn equates to about 26% of its market value. That's fairly notable cash burn, so if the company had to sell shares to cover the cost of another year's operations, shareholders would suffer some costly dilution. Even though its cash burn relative to its market cap makes us a little nervous, we are compelled to mention that we thought Phoenix New Media's cash runway was relatively promising. Cash burning companies are always on the riskier side of things, but after considering all of the factors discussed in this short piece, we're not too worried about its rate of cash burn. Taking a deeper dive, we've spotted 3 warning signs for Phoenix New Media you should be aware of, and 1 of them is significant. Of course Phoenix New Media may not be the best stock to buy. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks with high insider ownership. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
