Caution, Omicron Surge Ahead
Also in today’s edition: TikTok’s serving dinner, Macron’s Europe, CCI pulls up Amazon, China gets after online brokers
Good Morning! A Philadelphia woman gave birth in a Tesla. Yiran Sherry delivered the baby in the car while it was on autopilot. It was clearly not a place of her choice but the unmoving traffic made the decision for her. In a hat-tip to the EV Maker, the Sherrys have decided to call the baby girl Tess. She’ll be the first baby born in the Muskverse.
Btw, our podcast has been going strong for two months now. Tune in on your daily jog, drive to the office, or even as you WFH-ers have breakfast in bed. We promise it’ll be music to your ears.
The Market Signal
Stocks: Omicron and inflation continued to impact market sentiment, prompting investors to sell stocks, pushing major indices down. Mid-cap and small-cap indices on the BSE too fell steeply. The coming week is a short one for world markets with Xmas holidays beginning Friday. Stock markets are likely to be lacklustre for the rest of the year with most offices shut and people on holiday.
TikTok Chows Down On Food, Fashion
The world’s fastest-growing social media platform now has its finger in the restaurant pie.
TikTok is partnering with cloud kitchen service Virtual Dining Concepts to launch 1,000 TikTok restaurants in the US by the end of 2022. The delivery-only menu will consist of the app’s most viral food trends. Think baked feta pasta, corn ribs, pasta chips, and others that find favour among the platform’s one billion monthly users.
Profits will go to the original recipe creators; that said, it’s unclear how TikTok will determine original authorship of these recipes. The company also indicated that the concept is more a marketing strategy than a dive into the restaurant business. This will be ByteDance’s second attempt in the space (first in the US, though), having tested a live-streaming-based food delivery option for Douyin users in China.
Food for thought: The irony of TikTok wanting to feed Americans isn’t lost on those who are concerned over the app’s glut of eating disorder videos. An exclusive report by The Wall Street Journal shows how TikTok’s famed algorithm is populating teenagers’ feeds with videos glorifying body shaming, anorexia, bulimia, and even suicide. Prior to the WSJ report, TikTok said it will adjust its algorithms to “avoid negative reinforcement”. Also, schools across the US cancelled classes due to reports of threats made on the platform. Interesting times.
Everything’s as it seams: Meanwhile, ByteDance, TikTok’s Chinese parent, is buckling down on online fashion with an eye on younger “Gen Z” audiences. Through “Douyin Box”, ByteDance is expected to take on the likes of Alibaba, JD, and Pinduoduo. Douyin Box is expected to sell viral apparel, accessories and makeup by Douyin’s top fashion influencers.
Watch This Space
As 2021 comes to a close, European politics is moving to a critical stage.
Russia has demanded that Nato give it in writing that Ukraine will not become a member of the security alliance. It has also asked for withdrawal of military deployments from central and eastern Europe.
Currency crisis: Turkey’s currency crisis has worsened after the lira plummeted further following President Recep Tayyip Erdogan's unusual plan of slashing interest rates despite soaring inflation. Turkey has now cut interest rates by more than 5 percentage points.
Macron’s EU: France is set to take over the presidency of the EU Council from January 1 for six months. French President Emmanuel Macron, who will seek a second term in April, has manoeuvred himself to centre stage of the EU project, forging alliances and trying to build consensus on critical issues such as digital sovereignty, environment and migration.
Meanwhile, the UK Prime Minister Boris Johnson is in a soup with rising Omicron infections and the crucial loss of a parliamentary seat that his party had not lost for two centuries.
CCI Throws Spanner In Amazon’s Retail Ambitions
A 57-page order by the Competition Commission of India (CCI) has become a stumbling block to Amazon’s retail ambitions in India.
The TL;DR: Holding that Amazon hid details and lied in filings, the Commission imposed a whopping Rs 200 crore for “failure to notify” the details of the deal as per law, and Rs 2 crore for suppressing the “actual scope and purpose” of the deal.
Not done yet: iPhone maker Apple has, meanwhile, urged the CCI to throw out a case that alleges that it dominates the ‘apps’ market claiming it is “too small a player” in India, according to Reuters.
Friday’s CCI order appears to be signaling one of the final chapters, if not the last, in the ongoing Amazon-Future-Reliance saga. The CCI has effectively suspended (or reversed, if you like) its own order from November 2019 approving Amazon’s purchase of a 49% stake in Future Coupons. It is a major setback to the US retailer’s ambitions for India. The order more or less clears the way for the $3.4 billion sale of Future’s assets to Reliance Retail, arguably Amazon’s strongest rival. It has a 60-day window to give notice for a fresh deal with Future (as unlikely as it sounds). Amazon is also likely to appeal the CCI order.
Experts Worry Covid 3.0 Round The Corner
The masks need to stay on. Experts are suggesting that India’s third Covid-19 wave could peak as early as February next year. While Maharashtra has reported 54 Omicron cases, Delhi has found 22. The capital has also reported the highest number of cases since June 27. Meanwhile, 100% of eligible citizens in Andaman and Nicobar Islands have been double-jabbed.
Global rounds: The World Health Organization has declared that the variant has been detected in 89 countries and community transmission is doubling cases every 1.5 to 3 days. Central China has been hit with new cases. In Europe, restrictions are back. The UK health minister is mulling over a "circuit breaker" lockdown. The Netherlands has imposed a lockdown until January 14, 2022; Paris has cancelled its New Year’s Eve fireworks while Denmark and Ireland have enacted stricter Covid rules.
Mind that sniffle: Omicron symptoms could seem like the common cold’s—a runny nose, sneezing fits, headaches, fatigue and a sore throat. While higher vaccination rates mean that things could be a little more under control this time around, early research shows that even two vaccine shots have lesser efficacy against the variant.
China Cracks Its Whip Again
Just as it seemed China’s giant 2021 tech lash was nearing a temporary pause, the country’s regulators have struck again. This time, they’ve come for online brokerage firms, banning some such as Futa Holdings Ltd and UP Fintech Holding Ltd. This follows last month’s ban on brokerages hiring social media “finfluencers” and live-streaming.
Tell me more: These companies have been banned from trading securities to mainland clients. Chinese regulators are reportedly concerned about breach of data security, and capital outflows.
Golden Shares: Through a familiar practice of “golden shares”, the Chinese government will now expand its presence in large technology companies through a minority stake. It is doing so under the pretext of data security. A Reuters report stated that it already has golden share arrangements or is in talks with companies such as Full Truck Alliance, Didi, ByteDanc, and Ximalaya.
What Else Made The Signal?
Home-run: Sony's Spider-Man: No Way Home is breaking box office records. The Marvel movie has generated $587.2 million in worldwide weekend ticket sales. This is, despite Omicron playing villain the world over.
Onwards and upwards: SaaS start-up Hevo Data has bagged $30 million from investors in a round led by Sequoia Capital India. The total funding now adds up to a neat $43 million.
Heavy price: JPMorgan Chase will cough up $200 million in fines for encouraging employees to use personal messaging apps to discuss business.
New vaccine just dropped: Novavax, another jab made by Serum Institute of India, has been cleared for emergency use by the WHO.
ITC goes DTC: ITC has acquired an 8.70% equity stake in Ayurvedic personal care brand, Mother Sparsh Baby Care.
Bloom gloom: Sure, these daffodils are stayin’ alive, but they need some attention. Cornwall's daffodil fields are facing a critical labour shortage. Immigrant labour is scarce and locals aren't interested in getting their hands dirty. Flower growers fear this is the beginning of the end.
Nifty with NFTs: Things are moving fast for Adidas, and happily so. The sports apparel company has netted $23.5 million by giving away 30,000 NFTs. This, despite a tech niggle during the sale.
Melania’s Vision: Melania Trump is the latest celebrity to join the NFT craze. The offering is a digital watercolour of Melania's "cobalt blue eyes" and a recorded "message of hope" from her. A portion of the proceeds from the sale will also go to help children in foster care.
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