Market Round-Up

Apple's iPhone sales in China experienced a remarkable surge in April, increasing by 52% compared to the same period last year. The company saw a notable improvement in its shipments to China, with a 12% increase in March, a substantial recovery from the 37% decline experienced earlier in the year. This rebound follows a challenging start to the year, during which Apple faced fierce competition from local rivals such as Huawei, highlighting Apple’s strategic efforts to regain its market position.

In an effort to boost sales in China, Apple offered substantial discounts, up to 20%, during the JD.com 618 shopping festival. This strategy appears to have been effective, driving strong sales momentum for the company. Coupled with a strong earnings boost and a significant stock buyback earlier this year, Apple's outlook remains positive, as the company aims to expand its gross profit margins to 46.6% this quarter.

Shop inflation in the UK reduced in May, driven by a decrease in prices for furniture and non-food items, according to industry data. The British Retail Consortium (BRC) reported that store prices fell at an annual rate of 0.6% in May, down from 0.8% in April. This marks a significant improvement from the peak inflation rate of 9% recorded in May 2023.

Helen Dickinson, Chief Executive of the BRC, noted that price levels are starting to return to normal, largely due to retailers reducing prices to stimulate consumer demand which had been dampened by unusually wet weather. This price-cutting strategy appears to have successfully revived consumer spending and gives a positive outlook for the future.

Amid these developments, the Bank of England is considering its first interest rate cut since 2020. Rates have remained unchanged for six consecutive meetings, but market anticipation suggests that a rate cut may be on the horizon in June.

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