A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the World Wide Web.
Fitch Ratings is forecasting that the era of Apple Inc.and Samsung Electronics Co. Ltd. 's dominance of the smartphone industry is coming to an end as cheaper devices gain market share. FastFT reports, "Apple and Samsung sold 467m phones in 2013, but Fitch predicts the total will slip to 450m in 2014, even as global smartphone shipments rise by 20 per cent to 1.2bn. The principal competitors are China's Xiaomi, Lenovo, Huawei and India's Micromax Informatics."
Ratings agencies haven't exactly covered themselves in glory over the past decade but the history of the technology industry suggests the warnings should be taken seriously. Technology is unique in breeding companies with enormous market share in specific niches – BlackBerry Ltd., and Netscape Communications Corp. are good examples – followed by ignominious declines.
"Apple, Samsung smartphone dominance to wane" – FastFT (subscription required)
One of the quickest ways to lose online readers here at the ROB is to write about Europe, but I suspect that's about to change. The rapid deceleration in the German economy, the primary engine of growth in the region, puts global economic growth at risk. For Canadian investors, this feeds directly into commodity prices.
"The outlook for Germany in one word : 'Grim' " – Business Insider
An IMF report casts doubt on government spending as an economic panacea. The study, which analyzes long term growth after spending binges in a large number of countries, concludes that "the econometric evidence reveals small positive and instantaneous associations between public investment booms and economic growth, but little long run impact."
Attempts to debunk this report will be vehement.
"Public investment as an engine of growth" – International Monetary Fund
Good news for barbecue lovers – pork prices are headed lower as supply issues fade. The PED epidemic in North America, though not dangerous to humans, resulted in a shortage of pigs and sky-high prices that fed through (you see what I did there) to beef and poultry. The news is also marginally positive for overall consumer spending on both sides of the border.
Sober Look has the relevant chart – Twitter
The International Energy Agency forecasts that 2014 global energy demand will be weaker than previously expected. This puts downward pressure on energy prices when crude markets were already enduring a difficult month.
The Wall Street Journal quotes the IEA: "Remarkably low oil deliveries in both Europe and North America helped slash this report's estimate of global demand growth for the second quarter of 2014 to less than 700,000 barrels a day year-over-year — a low of more than two years."
"IEA lower 2014 oil demand growth forecast on global economic outlook" – WSJ
Tweet of the day is from @zerohedge: "The World's Most Expensive Home Is Up For Sale tinyurl.com/lukrr2b"
Diversion: Continuing today's grilling theme, "Science says you don't need to thaw your steaks" – Vox
Follow Scott Barlow on Twitter @SBarlow_ROB
Scott Barlow