December 9, 2024 Edition

Welcome to this week's newsletter, where we explore significant global developments that may impact markets and investment strategies. Key themes include political instability in France and South Korea, the ongoing turmoil in Syria, the implications of a potential TikTok ban in the U.S., and positive trends in the U.S. job market. Let’s delve into these crucial updates.

Political Instability in France, South Korea, and Syria

(Source: BBC; CNN; CNBC) The global political landscape has experienced significant upheaval this week. In France, the government has collapsed following a no-confidence vote against Prime Minister Michel Barnier, who served for just three months. MPs voted overwhelmingly in support of the motion, initiated by opposition parties after Barnier controversially used special powers to push through his budget without a parliamentary vote. This marks the first time a French government has fallen via a no-confidence vote since 1962.

Meanwhile, in South Korea, President Yoon Suk Yeol has been facing intense pressure to stand down as leader, after his shock bid to declare martial law in South Korea.  He narrowly avoided impeachment after members of his own People Power Party (PPP) boycotted the parliamentary vote. Although he remains in office, calls for his resignation persist, as the PPP leader has indicated the party will push for his departure to reduce political instability. The Korean won and stock market experienced volatility last week amid this uncertainty but appear to have stabilized following the president's survival of the impeachment vote.

In Syria, the Assad regime faces a critical juncture as rebel forces led by Hayat Tahrir al-Sham (HTS) have captured Damascus, signaling a potential end to over 50 years of Assad family rule. This dramatic shift in the Syrian civil war has prompted the UN Special Envoy to label it a "watershed moment," urging for stable and inclusive transitional governance. Syrian Prime Minister Ghazi al-Jalali remains in the country, expressing readiness to facilitate the continuity of Syrian governance.

Political volatility in 2024 may persist into 2025, underscoring the importance of diversification. We recommend investors explore alternative investments to diversify and enhance portfolio resilience.

TikTok Set to Be Banned in the U.S.

(Source: BBC ) In the U.S., a federal appeals court has upheld a law mandating a TikTok ban or sale by early 2025, citing national security concerns over its alleged links to China. This decision has raised questions about the potential political shift, as President-elect Donald Trump previously stated he would oppose the ban but now faces bipartisan anti-China sentiment in Congress.

TikTok creators, including many small businesses, have expressed concerns about losing their audience and revenue, yet many remain reluctant to migrate to rival platforms like Instagram. This situation underscores how national security remains a critical factor for investors, particularly in sectors tied to technology and social media.

U.S. Job Market Bounces Back

(Source: MSNBC)  On a more positive note, the U.S. job market has shown resilience, adding 227,000 nonfarm jobs in November, significantly exceeding expectations. While the unemployment rate inched up to 4.2%, this figure remains historically low, contributing to an overall positive economic outlook.

The stronger-than-expected jobs data has increased the likelihood of a December rate cut, creating favorable conditions for continued growth in the U.S. equity market. As we look toward 2025, a prolonged rate cut cycle is expected to support economic stability.

In summary, the global landscape is marked by political upheaval in France and South Korea, critical developments in Syria, potential regulatory challenges for TikTok, and encouraging signs from the U.S. job market. These dynamics underscore the importance of staying informed and adaptable in an ever-changing environment. We invite you to reach out to Altive for further discussion or support in navigating these developments.

Disclaimer

This newsletter contains information from public sources, and any investment decisions made based on its contents are at the reader's own risk. Investing involves risks and might result in loss of capital invested. Past performance is not a guarantee of future results.

Altive Limited (“Altive”, SFC CE Number: BPK587) is a first-class alternative investment platform in Hong Kong licensed under the Securities and Futures Commission (“SFC”) with Type 4 (Advising on Securities) and Type 9 (Asset Management) licenses. Altive only provides services to professional investors, defined in the Securities and Futures Ordinance and its subsidiary legislation. Altive does not provide tax, legal, or accounting advice. This newsletter should not be relied upon for tax, legal, accounting advice, or advice of any nature. Readers should consult professional advice before engaging in any transactions.