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Hi John, here's what you need to know for December 3rd in 3:13 minutes.

⏳ Keep it brief

• Black Friday ecommerce sales hit a record this year – but that’s not good news for all retailers
• Manufacturing data around the world has improved, and so have investors’ appetite for stocks

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What’s Going On Here?

Black Friday was the order confirmation email online retailers were looking for: US ecommerce sales reached an all-time record of $7.4 billion – but initial data for retail stores suggested sales fell 6%.

What Does This Mean?

Black Friday – so named because it’s when retailers would usually become profitable for the year (i.e. “go into the black”) – is one of the calendar’s biggest shopping days. It’s therefore a helpful barometer of the state of the retail sector.

It’s probably no surprise that people preferring to shop online means several traditional retailers lose out. But not everyone’s been felled by Amazon’s growth: retailers focusing on engaging customer experiences (like Target’s Disney Stores) or offering things Amazon can’t (like home improvement firms Home Depot and Lowe’s) are holding their own. But stores that can’t best Amazon on price or products – namely, department stores – are struggling. Case in point: Target’s shares are up 90% this year – while Macy’s shares are down 50%.

Why Should I Care?

For markets: Money does buy you happiness.
American consumers are more important than they might realize – as businesses have cut investment in the face of trade uncertainty, American consumer spending has propped up the US and, by extension, the entire global economy. With the world so reliant on them, it’s fortunate that consumer confidence is high as the holidays approach. But all eyes are on this Friday’s new consumer confidence reading, which will show whether those spirits are still high.

The bigger picture: Hong Kong orders declined.
The global economy isn’t as reliant on Hong Kong’s consumers. That’s perhaps no bad thing, since fresh data on Monday showed retail sales there plummeted a record 24% in October from the same time last year. That’s largely down to months of protests, which have scared away tourists and shoppers – and bad news for luxury retailers, who’ve become increasingly reliant on Asian markets.

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Rock And Roll

What’s Going On Here?

Investors can keep believin’: new manufacturing data on Monday showed that both China and Europe’s factories are doing better than expected. Investors took it as a signal that the economy’s growth will go on, and on, and on, and on…

What Does This Mean?

The manufacturing sector’s smelt of cheap perfume lately: the US-China trade war has hit factories in both China and Europe (which supplies many Chinese manufacturers with components). But the latest data’s bucked that trend – in November, the Chinese manufacturing sector expanded the most in three years, beating economists’ expectations.

Manufacturing activity is still shrinking over in Europe, meanwhile – but it’s doing so more slowly than investors expected. Some will win, some will lose: job losses continued for their seventh straight month in Europe, and business confidence in China fell.

Why Should I Care?

For markets: Payin' anything to roll the dice.
Investors appeared to take Monday’s news as an indication the economy might be doing alright. Those who’d expected a slowdown and bought relatively safe assets, like government bonds and gold, initially sold them off on Monday. Instead, investors boarded the midnight train to Asia, where they bought stocks. Several investors think economic growth will pick up next year, so are increasing the riskiness of their portfolios by buying stocks in the hope of higher returns.

The bigger picture: Livin’ in a lonely world.
One place where investors didn’t gain confidence was the US, where manufacturing data in November was worse than expected. And matters were made worse by tweets from the US president, who announced on Monday he was reimposing tariffs on steel from Brazil and Argentina (tweet this). Both countries have benefited from the US-China trade war since China, reticent to buy from the US, has started buying agricultural products from its southern neighbors instead. Optimistic investors be warned: forecasts of an economic recovery rest on easing trade tensions, but a single tweet can put paid to that…

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