Here’s what you need to know today

• The Israeli Defence Force has said it is preparing for a potential ground invasion of Lebanon, targeting Hezbollah positions. This follows intensive airstrikes which have resulted in 636 deaths including 50 children since Monday. US President Joe Biden, Turkey’s President Erdogan and France’s President Emmanuel Macron called for an urgent de-escalation.
  
  

• REA Group was rejected a third time by UK property listing platform Rightmove. The company called REA Group’s £6.1 billion bid “unattractive” and the board unanimously dismissed the proposal.
  
  

• Microinvesting platform-turned-superannuation fund Spaceship has been acquired by online broker eToro in a deal reportedly worth $80 million. In its 8 years in operation, Spaceship raised $60m, signed up 200,000 customers and amassed $1.5 billion in assets under management. More recently, Spaceship ran into trouble with Australia’s corporate regulator ASIC.
  
  

• As Australian gambling giant Star negotiates with lenders and governments to stay in business, Queensland Premier Steven Miles told reporters he ended discussions with the casino operator after executives refused to give up their bonuses in exchange for assistance. Star separately secured a multimillion-dollar lifeline from creditors.
  
  

• Meta has unveiled their first working prototype of augmented-reality glasses, called Orion. (Rather than explaining it, you really have to look at the photo). These glasses are not for sale, but rather are an internal prototype Meta is working on. The company hopes to ship the first commercial version by 2027.
  
  

• In the same announcement, Mark Zuckerberg also claimed Meta AI has 500 million monthly active users. (We’d hazard a guess most of those are due to Instagram replacing the search bar with a Meta AI question bar).
  
  

• Google has lodged a formal complaint against Microsoft with the European Commission, claiming anti-competitive practices in the cloud computing space. Google claimed Microsoft charge a 400% mark-up on use of Windows operating systems if used on rival cloud providers (like Google) rather than Microsoft’s own cloud platform Azure.
  
  

• Boeing has announced it has stopped all production of 737 planes because of the ongoing machinist strike. Estimates are that the ongoing strike of 33,000 workers is costing Boeing $50 million a day. (Don’t fret just yet, the company did have $12.6 billion cash on hand in its last quarterly update).
  
  

• The amazing results from studies of Ozempic continue. A study from Case Western Reserve University found that semaglutide drugs like Ozempic may reduce the risk of opioid overdose in people with type 2 diabetes who have a history of opioid use. This is just the latest study that suggests semaglutide may help manage addiction-related behaviours.

What the…?

The AI hype continues. Google has just paid $2.7 billion to acquire a chatbot that allows you to talk to AI versions of celebrities. According to Time, many of the 18 million AI characters created have been used for romantic role-play and are a mix of “absurdist, racy, or explicitly sexual.”

Investing is a lifelong journey

Here’s what you can learn today.

This is an excerpt from our conversation with Mary Manning titled ‘Why Asia is too big to ignore’. Listen to the full episode on the Equity Mates Investing podcast.

Question: What interests you about investing in Asia?

The growth story in Asia is compelling and not just about high growth figures. It’s about structural growth driven by demographics. Countries like India and Indonesia are examples where demographic changes will fuel growth. Additionally, as these are emerging economies, there are various structural factors at play, such as infrastructure development. 

When I first visited these countries over 20 years ago, there was minimal infrastructure. Observing that build-out provides a strong backdrop for growth. There's also significant technological leapfrogging; for instance, while many developing countries lacked shopping malls, everyone had mobile phones, allowing rapid growth in e-commerce. Companies in Asia, whether global players like Alibaba or local startups, are leapfrogging traditional retail models.

Moreover, overall productivity gains in Asia are more pronounced than in other markets, resulting in sustainable growth. Valuations in Asia are generally lower, which reflects the emerging market risk premium. Despite challenges in the U.S. and Europe over the past few years, markets continue to hit all-time highs. If similar events occurred in emerging markets, they would likely experience severe downturns, yet this valuation discount often lacks justification, particularly for countries in North Asia.

Consequently, with the combination of rapid growth, lower multiples, and potential inefficiencies in the market, investing in Asia presents unique opportunities that I find very promising.

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