While you were sleeping, the Chinese stock market took its biggest nosedive in eight years, providing an answer to the question: How long can Beijing stop the inevitable? The Shanghai Composite Index bottomed out on July 8, then rallied for two weeks on what was called the “Xi Jinping put” – an extraordinary series of government measures designed to discourage (prohibit?) selling and boost buying, including a commitment to spend $20 billion via 21 brokers. It worked for a while. But markets have a strong anti-authoritarian streak, and Xi Jinping has now learned that it’s a bad idea to use the stock market as a measure of the success of his policies.
Separately, the Wall Street Journal poured more cold water on the notion that the U.S. is turning into a nation of freelancers. I’ve addressed this issue before: The rise of on-demand markets like Uber, Airbnb, Taskrabbit, etc., does hold the potential to profoundly change the nature of work, and over time I suspect it will have significant effects on the economy. But right now, it’s a phenomenon at the margins. If anything, statistics show Americans are less likely to be self-employed or hold multiple jobs than in the past.
Enjoy the day.
• Teva pursues a new deal
Teva is spending $40.5 billion for Allergan’s generic drug business, a deal that allows it to drop its unsuccessful bid to buy Mylan. The pharmaceuticals industry is seeing a ton of merger and acquisition activity: big firms are trying to realign their operations to zero in on a small number of growth opportunities, while smaller producers are seeking larger scale. WSJ (subscription required)
• Fiat Chrysler hit with steep fine
Fiat Chrysler has agreed to pay a record $105 million penalty after an investigation into whether the auto maker delayed acting on safety defects on light trucks and cars. The company also agreed to buy back more than a half-million vehicles. The actions are a sign that the U.S. National Highway Traffic Safety Administration, which regulates the auto industry, is stepping up oversight after some criticism it didn’t react fast enough to issues involving General Motors and Takata Corp. Bloomberg
• Hong Kong feels China’s pain
A slowing Chinese economy, President Xi Jinping’s anti-corruption and austerity campaigns and fewer group tours are stinging Hong Kong’s retail sector, hurting demand for pricy cognac and designer bags in a city that relies too heavily on China for business. Retail sales fell in four of the five months through May, with jewelry, watches and other high-end gifts the worst hit. “We’re just too exposed to China,” said an economist at UBS AG. Bloomberg
• More energy sector layoffs planned
A sudden drop in U.S. crude-oil prices to under $50 a barrel, rather than the rebound some energy companies had hoped for in the second half of 2015, will result in more layoffs and asset sales as firms seek financial wiggle room. Halliburton and Baker Hughes are among the companies that have announced plans to cut more jobs than they had anticipated in February. Job cuts, which initially focused on blue-collar jobs, are also extending to engineers and scientists. WSJ (subscription required)
Around the Water Cooler
• Is student debt hurting housing?
There is a tendency to peg the slow rebound of the housing market on high student loan debt that is holding back potential homebuyers, in particular millennials, from dipping into the market. But a pair of researchers say they found no evidence that the probability of owning a home decreased as the amount of student loan debt taken on by debtors has swelled. Interestingly, the researchers said the real crisis may be that too few people are getting a degree, not too many. Fortune
• Where the millionaires flee
China and India – two of the globe’s fastest growing economies – are also seeing more of their wealthiest citizens leaving their countries to settle down abroad. A new report has said those two nations have seen the highest exodus of millionaires, with the U.K. seen as the most popular city for the world’s rich to settle down in. Time
• A retail gig that employees don’t hate
Nugget Market, a small West Coast grocery chain, is a tiny competitor in the food aisle with just $275 million in annual revenue. But the retailer can claim big bragging rights as it has made Fortune‘s 100 best companies to work for list every year since 2006, partly due to extensive training for employees and salaries that top national averages for similar positions at rival retailers. Nugget Market’s reputation is clearly known locally: last year, it sorted through applications from 10,400 people for 273 spots. Fortune
5 things to know this week
Fed meeting, Greek talks, and Facebook — 5 things to know this week. Today’s story can be found here.