China economic slowdown

What happened: Chinese retail sales and investment slumped in May, with retail sales posting their first drop in over three years. This comes amidst graduation season, where millions of young graduates are entering a job market with limited opportunities. The slowdown is the worst since the COVID pandemic, exposing risks in China's two-speed economy.

Market impact: Chinese stocks and the yuan dropped following the dismal data. The slowdown affects consumer-facing industries and companies, as well as those reliant on domestic demand. The job market's weakness may also impact financial institutions and human resources companies.

What to watch next: Investors should closely monitor China's June economic data, due in early July, for signs of a rebound. Additionally, the government's policy response, including any fiscal stimulus measures, will be crucial in determining the narrative's trajectory.