Tech vibes

Daily update

Technology stocks have had another episode of weakness, with trading in the South Korean market suspended after an 8% decline. This is still not enough to change perceptions of consumer spending —yesterday’s US data was a reminder that monthly cash savings have provided the resources to support consumer spending. However, a moderation of real world investment in tech does have economic implications, not least because tech investment has cannibalized non-tech investment.
Apple’s announcement of sizeable product price increases was blamed on the cost effects arising from AI demand for chips. Normally a single company raising prices is not noteworthy, but for certain demographics this is a highly visible price. Economically the impact is negligible, but it is something that could contribute to a more negative political vibe around AI—data center construction has already been challenged.
Japan’s June Tokyo consumer price inflation data was affected by changes in government influenced prices (water, and medical costs in particular). The Bank of Japan started the year with an accommodative stance, and has been moving to a more neutral policy position.
Oil prices have reacted little to news of a Singaporean flagged cargo ship being attacked in the Strait of Hormuz. Investors never assumed reopening the strait would be a straight line.