Business Frame Weekly – China will be the top contributor to global growth / U.S. stocks closed higher during Monday's trading session

China will be the top contributor to global growth over the next five years, with its share set to be double that of the US, according to the International Monetary Fund.

U.S. stocks closed higher during Monday's trading session as another round of critical earnings got underway.

The stock market is heading for a sharp setback that could see the S&P 500 plunge about 22% over the coming quarters, according to the chief market strategist at FS Investments.

In this newsletter:

• China to Be Top World Growth Source in Next Five Years, IMF Says
• Stocks closed higher amid a flurry of earnings: Stock market news today
• 'There's no reason to wait': Sell US stocks now before the S&P 500 tanks by over 20%, strategist says
• Elon Musk Founds New Company To Challenge GOOGL, Microsoft's ChatGPT; Is AI Stock A Buy?
• Starting tomorrow, only six EVs will still qualify for a $7,500 federal tax credit

April 18, 2023

China to Be Top World Growth Source in Next Five Years, IMF Says

China will be the top contributor to global growth over the next five years, with its share set to be double that of the US, according to the International Monetary Fund. The nation’s slice of global gross domestic product expansion is expected to represent 22.6% of total world growth through 2028, according to Bloomberg calculations using data the fund released in its World Economic Outlook released last week. India follows at 12.9%, while the US will contribute 11.3%.

Stocks closed higher amid a flurry of earnings: Stock market news today

U.S. stocks closed higher during Monday's trading session as another round of critical earnings got underway. Investors remain focused on results from financial institutions following the failure of Silicon Valley Bank last month. At the close, the S&P 500 (^GSPC) edged up 0.33%, the technology-heavy Nasdaq Composite (^IXIC) gained 0.28% and the Dow Jones Industrial Average (^DJI) added 0.30%.

'There's no reason to wait': Sell US stocks now before the S&P 500 tanks by over 20%, strategist says

The stock market is heading for a sharp setback that could see the S&P 500 plunge about 22% over the coming quarters, according to the chief market strategist at FS Investments. That means investors shouldn't wait anymore to cash out on this year's rally in equities, and should start selling their holdings now, Troy Gayeski said during a recent episode of the "What Goes Up" podcast hosted by Bloomberg. "There's no reason to wait. It's not like you're going to leave 10% upside on the table," he said.

Elon Musk Founds New Company To Challenge GOOGL, Microsoft's ChatGPT; Is AI Stock A Buy?

Tesla (TSLA) chief Elon Musk has started an AI company. On Friday, Musk incorporated the new company, X.AI in Nevada. Musk is the sole director of the company and plans to make a private sale of 100 million shares of the new startup. Earlier, in March, Musk and others asked for a 6-month pause in AI systems training that involved technologies more advanced than GPT- 4. So where does that leave C3.ai (AI)? The stock rose nearly 5% on Monday as the AI race takes a new turn. Musk's company will count Google parent Alphabet (GOOGL) and privately-held OpenAI among its rivals, as well as C3.ai.

Starting tomorrow, only six EVs will still qualify for a $7,500 federal tax credit

The IRS released a list of electric vehicles that still qualify for the full $7,500 federal tax credit after strict new guidelines, announced back in March, officially go into effect on April 18th. The list is very short, as just six EVs now qualify under the new terms. The updated rules pertain to EV batteries and cut out China as an approved trading partner, so we knew the vehicle list would shrink, as most electric vehicles use batteries manufactured in China or by Chinese companies. If you want to get that full tax credit, choose from the Cadillac Lyriq, Chevy Bolt, Chevy Bolt EUV, some Tesla Model 3 versions, some Tesla Model Y versions, and Ford F-150 Lightning.

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