— US Luxury Rental Market Remains Resilient; China Becomes Global Shipping Leader; US Steel Receives Multiple Acquisition Offers; US Treasury Yields Hit New High; Neymar Joins Saudi Club with Record Deal; Private Equity Giant CVC Revives IPO Plan; Missed Payments at Zhongzhi Spark Panic
1. US Luxury Rental Market Remains Resilient
A new report from Marcus & Millichap shows that since the end of 2022, vacancy rates for Class A rental apartments in the U.S. have risen by 0.3%, while Class B and C units saw increases of 0.4% and 0.8%, respectively.
In the first half of 2023, a record 200,000 luxury rental units were completed—25,000 more than the previous high.
However, with homeownership increasingly unaffordable, many potential buyers are forced to continue renting, helping to sustain demand for rentals.
In Q2, the monthly cost to own a median-priced home in the U.S. was $660 higher than renting.
With student loan repayments resuming, young people will find it even harder to save for down payments.
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2. China Becomes Global Shipping Leader
According to Clarkson Research Services, the world’s largest shipping broker, Chinese companies have surpassed Greece in total shipping capacity for the first time, making China the top nation by this key metric.
China relies heavily on imports of raw materials and is also a leading exporter of manufactured goods.
Clarkson’s report notes that China leads globally in both wholesale commodities and shipping sectors.
Greece had held the top spot in shipping volume since 2013 before being overtaken by China.
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3. US Steel Receives Multiple Acquisition Offers
US Steel Corporation has recently received multiple unsolicited bids, suggesting its production transformation efforts may finally be paying off.
CEO David Burritt announced on Sunday that proposals include both offers for specific production assets and for the entire company.
Since taking over in 2017, Burritt has shifted the company from producing steel using iron ore to remelting scrap metal—a transformation that helped US Steel avoid bankruptcy.
The company has hired Goldman Sachs and Barclays to evaluate its strategic options.
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4. US Treasury Yields Hit New High
Today, the yield on the 10-year U.S. Treasury rose by 6 basis points to 4.213%, surpassing its August 4 record and reaching its highest level since November.
BMO Capital Markets strategist Ian Lyngen said Treasury yields are closely tied to expectations around the Fed’s first rate cut. Tomorrow’s retail sales report may trigger short-term market swings.
Yield increases have been driven by the U.S. credit rating downgrade and growing doubts about the Fed cutting rates next year.
U.S. stocks initially tumbled after the open but later erased losses as investor anxiety eased.
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5. Neymar Joins Saudi Club with Record Deal
Saudi media reported today that Brazilian soccer star Neymar will sign a two-year deal with Al-Hilal FC worth $175 million per year.
The contract allows Neymar to participate in the 2025 FIFA World Cup in the U.S.
Saudi Arabia is investing heavily to diversify beyond oil. This year, global stars such as Cristiano Ronaldo and Karim Benzema also signed record-breaking deals with Saudi clubs.
Sources say the Saudi Pro League has secured broadcasting rights in 130 markets worldwide.
Saudi Arabia aims to grow league revenue fourfold to $480 million annually by 2030.
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6. Private Equity Giant CVC Revives IPO Plan
Sources say CVC Capital Partners—Europe’s largest leveraged buyout firm—is reviving its multibillion-euro IPO plans, possibly as soon as year-end.
CVC, long known for staying under the radar, has recently invested in Formula 1 and English rugby.
Last month, it closed a record €26 billion buyout fund. With capital markets improving, the IPO is now more viable.
The listing will test investor appetite and confidence. CVC was last valued at €15 billion in a 2021 stake sale to Blue Owl.
The company previously shelved its IPO due to market uncertainty following the Russia-Ukraine war.
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7. Missed Payments at Zhongzhi Spark Panic
Several corporate clients have recently reported that Zhongzhi Enterprise Group—one of China’s largest private wealth managers—has failed to make scheduled payments on high-yield investment products.
To contain the fallout, Chinese financial regulators have assembled a team to investigate Zhongzhi and assess systemic risks.
Though not a household name, Zhongzhi manages $138 billion in assets, raised from high-net-worth individuals and businesses to invest in real estate, loans, equities, bonds, and commodities.
China’s trust industry manages a total of $2.9 trillion.
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This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.