HS's market week summarizes the week's most important financial news in one story.
Lagarde: The ECB will probably lower interest rates in the summer
The European Central Bank (ECB) will probably lower key interest rates in the summer, estimates the central bank's president Christine Lagarde financial news agency Bloomberg's in the interview.
Lagarde was asked at the Davos Economic Forum if interest rate cuts in the summer would be supported by the majority of the ECB's monetary policy-making council, considering that some members have said that interest rates will be cut in the summer or by summer. However, according to Lagarde, more evidence is still needed that the inflation trend is under control.
Money market investors have previously priced the ECB to lower its interest rates six times this year since the beginning of April. According to Bloomberg, the market reacted immediately to Lagarde's comments and five interest rate cuts are now expected. The market also no longer considers it certain that interest rate cuts would start in April.
On Wednesday, stock prices fell broadly in Europe immediately after Lagarde's statement had affected investors' interest rate cut expectations. The US stock market also opened to a noticeable decline.
Shocks can lead to higher prices
Houthi rebels' attacks on cargo ships cause disruptions to world trade. Due to the attacks, several shipping companies avoid operating in the Suez Canal, which is an important “shortcut” for cargo ships between Asia and Europe.
Because of this, cargo ships carrying goods to Europe have to go around the African continent.
In principle, delays can lead to many goods becoming scarce and their prices rising. This, in turn, would mean that central banks would have to postpone the easing of monetary policy, which would tend to slow down economic growth.
The announced strikes, if they happen, will also stop the industry
On Thursday, Teollisuusliitto submitted notices of extensive political strikes that would target several industrial branches in hundreds of locations across Finland. The strikes are part of industrial action against government cuts.
The strikes announced by Teollisuusliitto are planned to be organized as a two-day work stoppage on the 1st and 2nd. February.
The service sector trade union Pam said on Wednesday that it will organize strikes on February 1 as well.
The trade union Pro has also announced strikes on the 1st and 2nd. February.
Apple overtook Samsung as the world's largest smartphone manufacturer for the first time
The US technology giant Apple has become the world's largest smartphone manufacturer for the first time, according to statistics from the International Data Corporation (IDP), according to news agency AFP. Apple broke its main competitor Samsung's 12-year run as the market leader.
A total of 234.6 million Apple iPhones were sold in 2023, while South Korean Samsung sold 226.6 million smartphones.
Apple's market share was 20.1 percent, while Samsung's was 19.4 percent.
According to IDC experts, Samsung's loss of the top spot was influenced by the success of the iPhone, as well as the increasingly fragmented market for phones using the Android operating system.
Chinese Android competitors such as Transsion, Xiaomi and Honor have taken market share away from Samsung with their budget smartphones. Google is also increasingly competing with Samsung for the same consumers. In China, Samsung also lost market share to Huawei.
According to IDC statistics, 1.17 billion smartphones were sold in the world last year, which is 3.2 percent less than in 2022. However, the smartphone market showed signs of recovery.
Before Samsung, the world's largest smartphone manufacturer was Nokia.
Last week it was reported that the software giant Microsoft had overtaken Apple as the world's most valuable company for the first time since 2021.
Bloomberg: Chinese banks are tightening financing for Russia
China's state-owned banks are tightening the financing of their Russian customers, reports the news agency Bloomberg.
The US Treasury Department announced before Christmas that it plans to impose financial sanctions on banks that finance the purchase of equipment important to Russia's warfare.
According to Bloomberg's anonymous sources, at least two Chinese banks have begun to review their financing in trade between China and Russia.
According to Bloomberg's sources, the banks plan to cut financial ties with customers on the US sanctions list and end their financing of Russia's military industry.
China's state-owned banks are generally considered to take their orders from the country's administration. China thus seems to be adapting to US sanctions, even though the country has diplomatically supported Russia after it attacked Ukraine.
Nokia is increasing its investments in the US defense industry
Network equipment manufacturer Nokia is establishing a new unit that will focus on selling communications solutions for the defense industry to the US federal government.
In mid-December, the company announced that it was buying the US-based Fenix, which specializes specifically in communication solutions for the defense industry. Key products that Nokia is seeking to sell to the federal government include IP routers, optical networks, microwave links, fifth generation (5g) cellular network technology and private networks.
More than three thousand bankruptcies last year
Last year, more bankruptcies were filed in Finland than during the 2009 financial crisis.
According to data published by Statistics Finland on Wednesday, 244 bankruptcies were filed in December 2023, which is 22 bankruptcies more than in December of the previous year.
During 2023, 3,315 companies filed for bankruptcy, which is 25 percent more than the previous year. During the financial crisis in 2009, 3,275 companies filed for bankruptcy.
Still, compared to the recession of the 1990s, the number of companies that went bankrupt is significantly lower. During the worst recession in 1992, 7,391 companies went bankrupt.
Lukkaroinen leaves Terrafame
The mining and metals company Terrafame announced this week that the company's CEO Joni Lukkaroinen leave his job. He has been CEO of Terrafame since 2016.
The company's board has appointed Terrafame as temporary CEO Seppo Voutilainen and started the application process for a new CEO.
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