Pencil it in
Tech trade wars kick off
Good morning, tempermental traders. This is your Stock Market Rundown for October 26th, 2023. Thank you so much, once again, for reading. Let’s dig in:
TODAY’S TOP STORY: CHINA’S GRAPHITE GRIP 🪨
Everybody knows that America’s reliance on oil for our gas-guzzling cars makes us a slave to OPEC and the global energy market.
But even the oh-so-virtuous electric car is just as linked to global trade. It’s damn near impossible to build an electric vehicle in the US without raw materials from China.
One of the most critical raw materials: graphite. It’s a wonder substance, thanks to its conductivity and stability even in the hottest heat. When you’re scrawling notes with your mechanical pencil, the “lead” in that pencil is actually graphite.
But graphite’s real starring role is in electric vehicles batteries, where it’s the largest component by weight. Which means it’s a big problem for the EV industry that China—producer of two-thirds of the world’s graphite supply—has just announced it’s restricting exports of graphite products.
Geopolitical analysts say China is vengefully lashing out since the US government restricted exports of technology to Chinese firms. This is like reality-show drama, between hegemonic superpowers.
Spiking prices for graphite could cascade down to consumers and mean you end up paying more for your Chevy Bolt or Nissan Leaf. That has global carmakers scrambling to lock in supplies from sources outside China.
But our friends at Tesla are two steps ahead: they did a deal last year to lock in graphite supply from Mozambique. Lesson: it pays to be diversified.
SO WHAT ELSE IS GOING ON?
Amazon has started delivering medications by drone in Texas. If they can train the drone to inject my forehead with Botox, I might never need to go to the doctor again.
Discord, the platform where tweens playing Call of Duty scream gamer words at each other over voice chat, has unveiled a new in-app store that lets users buy digital goods. How about a fun party hat for your avatar?
Netflix stock was up on earnings that beat expectations with solid subscriber growth. Maybe now they can turn off that annoying “are you still there?” that pops up midway through hour three of binge-watching Bridgerton.
Microsoft’s recent quarterly results disclosed that Microsoft Teams now has 320 million monthly active users. They didn’t disclose how many times per day somebody on Teams says the words “you’re on mute”, but I’m guessing it’s a hundred million or so.
That’s it for today, my friends; see you tomorrow morning. Yours in capitalism, The Axe