Top Stories This Morning: The U.S. and Iran Exchanged Strikes; Shein Held an IPO Valued at $26 Billion
Clothing retailer Shein's IPO valuation was only a quarter of its peak valuation / Photo: X / SHEIN_Official
The U.S. and Iran exchanged blows for the first time in about a month. Global stocks and gold continued to fall following hawkish remarks by Federal Reserve Chair Kevin Warsh, which heightened expectations of an imminent interest rate hike. Online retailer Shein held its IPO in Hong Kong, which could result in its valuation being four times lower than its 2022 estimate. Read about these and other topics in our roundup of key events as of the morning of August 31.
The U.S. and Iran exchanged blows for the first time in a month
The U.S. carried out strikes on Iranian missile launchers that, according to the U.S. military, were preparing to lay mines in the Strait of Hormuz, Bloomberg reports. President Donald Trump also threatened to destroy the island of Khark, where Iran's main oil export terminal is located, according to CNBC.
In response, Tehran launched missiles and drones at U.S. air bases in Jordan. The Jordanian military intercepted eight missiles, and no damage was caused.
This marked the first U.S. military operation against Iran since late July and broke several weeks of relative calm, Bloomberg notes. Against the backdrop of this new escalation, Brent crude oil futures rose 2.4%, surpassing $90 per barrel.
Gold fell to a low of $4,400
Spot gold prices fell 1.2% during trading to around $4,400 per ounce, after suffering their sharpest decline since early June in the previous session, according to Bloomberg. The promise by U.S. Federal Reserve Chair Kevin Warsh to fight inflation has heightened expectations that the central bank will raise interest rates by the end of the year, the agency explains. The probability that this will happen as early as September is now estimated at nearly 50%.
“The shift toward a more hawkish stance came as a surprise to many investors,” so pressure on gold is likely to persist in the short term, Rajiv De Mello, global macro portfolio manager at GAMA Asset Management, told Bloomberg. He forecasts that prices will hover around $4,200–4,300 per ounce in the near term. At the same time, he intends to maintain his holdings in gold, as he views them as a long-term investment.
Shein went public with a valuation of $26 billion, compared with nearly $100 billion in 2022
Asian online retailer Shein raised $1.7 billion in its Hong Kong IPO, bringing its market value to as much as $26 billion, according to Bloomberg. By comparison, at its peak in 2022, the company was valued at $100 billion; however, even its current valuation may be high: the company is valued at more than 15 times its annual earnings, compared with 7.4 times for PDD, the owner of Temu.
Shein’s growth has slowed significantly due to tariffs and increased competition from Temu in the U.S. and Europe. Bloomberg Intelligence expects the company’s sales to grow by only 3.4% next year, to $44.3 billion, with net income of $1.7 billion. Shein’s shares will begin trading on Tuesday, September 1.
The U.S. will call on G20 countries to review trade terms with China
U.S. Treasury Secretary Scott Bessent intends to urge G20 countries to reconsider their trade terms with China, according to Reuters. According to the finance minister, the global economy is struggling to cope with China’s $1.2 trillion trade surplus, and Beijing is trying to offset its economic slowdown through exports rather than stimulating domestic demand.
The statement was made on the eve of the G20 finance ministers’ summit and one month before the meeting between Donald Trump and Xi Jinping. The U.S. is also preparing to impose a 7.5% tariff on Chinese goods due to excess production capacity, which could bring the total tariffs to about 20%, the agency noted.
What's Happening in the Markets
Global markets reacted with a sell-off to "hawkish" comments from the head of the U.S. Federal Reserve, according to Bloomberg. The MSCI Asia regional index fell 0.7%.
— South Korea’s Kospi, which is considered one of the indicators of sentiment surrounding investments in artificial intelligence, fell 1.2%, with chipmakers Samsung Electronics and SK Hynix contributing the most to the decline.
— Hong Kong's Hang Seng Index fell 0.6%, while mainland China's CSI 300 Index fell 0.4%.
— Japan's broad-market Topix index rose 0.3%, while the Nikkei 225 fell 0.4%.
— Australia's S&P/ASX 200 fell 0.2%.
— Nasdaq 100 futures were down 0.1%, S&P 500 futures were down 0.3%, and Dow Jones Industrial Average futures were down 0.2%.
This article was AI-translated and verified by a human editor
