SpaceX’s Setback, China’s Chip Stock & EV War

Today's briefing examines some of the highs and lows of investing in cutting-edge technologies, from the spectacular explosion of SpaceX's mega rocket to the dangers of social media app TikTok, as well as why the worsening trade war between China and the United States over semiconductor know-how is worrying Taipei and sending Chinese tech stocks higher.

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US President Joe Biden plans to sign an executive order around the time of the G7 summit in Japan on May 19 that would limit American business investment in key parts of China's economy, as part of the administration's ongoing battle to slow China's high-tech advances, particularly in chip manufacturing.

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Chinese chipmaker stocks have soared in response to all of the restrictions. Shares of local equipment companies such as Advanced Micro-Fabrication Equipment and chip foundry Semiconductor Manufacturing International Corp. rose as investors expected the conflict would drive Beijing to throw even more money into the technology. Will the rise persist as the US increases pressure?

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Meanwhile, Taipei is privately requesting that the US temper its rhetoric about America's reliance on Taiwan's chip-making enterprises, fearing that it is inflaming relations and discouraging investment in the island's economy.

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Another investor favorite is China's largest auto show, which is a celebration of electric automobiles. The Seagull, a vibrant yellow hatchback with high-end amenities like a 10.1-inch spinning touchscreen and bluetooth car keys but a starting price of less than $12,000, has been one of the event's standouts thus far. More contestants are expected before the event concludes this week. 

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The argument over the super-popular app TikTok rages on in the United States. Read our Big Take on why the app's algorithm continues to urge suicide on vulnerable children. TikTok claims to be improving, but the corporation is now facing a wave of lawsuits following many fatalities.

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After Elon Musk's Starship rocket blew up on its inaugural flight, SpaceX is returning to the launch pad. Still, for those looking for a vacation away from Earth, the French business Zephalto plans to carry guests into the stratosphere in a balloon for €120,000 ($132,000). While not technically in space, which NASA estimates begins at almost twice the height of Zephalto's airships, it does provide guests with the opportunity to experience something akin to being in space, with some great French cuisine and wine on the six-hour round journey.

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