Shares of global giants Tesla, Apple, and Caterpillar, all of which have a substantial presence in China, are facing a decline following the release of discouraging economic statistics.
According to figures unveiled by the National Bureau of Statistics on Wednesday, China’s gross domestic product (GDP) increased by 5.2% in the fourth quarter of 2023. Although surpassing the official target of around 5% growth set by the Chinese government, this figure represents one of the lowest levels witnessed in decades, as reported by SOME SOURCE.
In recent trading sessions, Tesla shares plummeted by 2.9%, Apple shares by 1.2%, and Caterpillar shares by 2.3%. These noteworthy companies heavily rely on sales generated from the Chinese market, as evident from their securities filings. Hence, it is expected that weak economic data would undoubtedly lead to a decline in their stock prices.
In the year 2022, Tesla’s total revenue amounted to $81.46 billion, with approximately 22% ($18.15 billion) attributed to sales in China.
Similarly, Apple reported a total net sales figure of around $383 billion in 2023. Notably, the Greater China region, which encompasses mainland China, Hong Kong, and Taiwan, contributed $72.56 billion, accounting for approximately 19% of Apple’s overall sales.
Caterpillar, on the other hand, recorded total sales and revenue of $59.43 billion in 2022. Impressively, the Asia/Pacific region, including Australia, New Zealand, China, Japan, Southeast Asia, and India, generated $11.89 billion in sales, equating to roughly 20% of the company’s total revenue.
Unsurprisingly, these well-known companies are not the only ones affected by the disappointing economic data from China. Chinese stocks have also experienced a downturn, with the American depositary receipts (ADR) of internet giant Alibaba Group Holding falling by 1.8%. Additionally, ADRs of JD.com and PDD Holdings, the parent company of Pinduoduo and Temu, witnessed declines of 5% and 2.8% respectively.
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