🇨🇳 China can’t stop winning

What’s Going On Here?

Netflix couldn’t pull off a livestream of Love Is Blind, so it’s probably no surprise that its results underwhelmed late on Tuesday too.

What Does This Mean?

After an outright drop this time last year, Netflix’s subscriber growth mishit for the second year in a row on Tuesday, adding 1.75 million users last quarter – short of analysts’ 2 million target – and nudging the total subscriber count to 233 million. And sure, with its newfound focus on profitable growth, it’s a good thing Netflix did beat profit expectations, but its less-than-stellar revenue and profit forecast for this quarter still left investors uneasy. Plus, Netflix hit pause on plans for a broad rollout of its password-sharing crackdown – in a bid to improve its current offering – delaying the anticipated revenue bump more accounts would bring. The result: an initial plunge in shares for the streaming giant.

Why Should I Care?

Zooming in: Sharing isn’t caring.

Netflix shares eventually found their footing after that nosedive, which makes a lot of sense. Granted, putting the brakes on the password sharing crackdown isn't ideal – but in reality it just postpones the good days. See, with 100 million folks piggybacking on shared accounts, it’ll only take a fraction of them going solo to make subscriber counts and revenue bloom. Combine that with the slow-but-steady launch of ad-supported options, and Netflix's growth train isn't likely to stop anytime soon.

The bigger picture: Love is blind, and viewers cannot see.

Netflix is no longer the only big fish in the streaming pond, with the likes of Disney and Amazon making sizable splashes of their own these days. In fact, consulting firm Parks Associates thinks that Prime Video actually managed to snatch Netflix’s crown as the top subscription service last year. That means Netflix will need to keep cranking out hits – while steering clear of live programming blunders (ahem, Love Is Blind) – to keep subscribers from jumping ship.

What’s Going On Here?

Fresh data out on Tuesday showed China’s economy grew faster than expected last quarter.

What Does This Mean?

Last week’s export data hinted that China’s economy was on the upswing, and now Tuesday’s figures have gone and confirmed those high hopes. In March, retail sales saw their biggest gain since June 2021, with a yearly jump of 10.6% – proving the long sought-after bounceback of the domestic economy has begun. Manufacturing investment flexed its muscles too, with a solid 7% rise during the quarter, while factory output revved up as the world’s factory got back in action. And sure, the recovery’s uneven – with private investment and property market segments still lacking – but the overall result was impressive: China’s economy grew 4.5%, outstripping the 4% economists predicted and hitting its fastest pace in a year.

Why Should I Care?

The bigger picture: Strength in numbers.

China's got some way to go to meet its 5% annual growth target, but economists think things will pick up even more as consumer and business confidence continue to rise. Plus, the all-important property market is showing signs of life, with new home prices in March swelling at their fastest pace in 21 months. Toss in the prospect of additional government stimulus too, and Goldman Sachs sees 6% growth in the cards for China this year.

For markets: The weight of the world.

If China bounces back like Goldman predicts, it could be a lifeline for global growth, especially with developed economies faltering. And that would be party time for commodities too: when the economy’s booming, the appetite for transportation and energy shoots up, giving oil and gas a boost. And more construction and infrastructure projects mean steel and copper get their time in the spotlight as well – which might explain why regional commodities markets got all fired up when the news broke.