Alibaba provides Chinese and international e-commerce platforms, logistics, and ancillary services. The company operates in four segments (Core Commerce; Cloud Computing; Digital Media & Entertainment; and Innovation Initiatives) and has announced plans to split into six businesses. Key marketplaces include Taobao, a consumer marketplace; Tmall, a third-party platform for brands and retailers; Alibaba.com and 1688.com, online wholesale marketplaces; Alipay, for online payments; and Lazada, for Southeast Asia e-commerce.

The dollar has strengthened in 2024, as the Federal Reserve has thus far not cut the fed funds rate, the U.S. economy has grown at a solid pace, and the high level of interest rates has attracted global investors into dollar-denominated securities. The greenback has climbed 2.5% on a trade-weighted basis in 2024 and is 17% above its average value since 2000. Looking ahead, we anticipate a relatively stable trading range for the dollar into 2025, for several reasons. For one, the dollar typically tracks GDP growth trends, and we think the U.S. economic expansion is poised to slow in coming quarters as the unemployment rate ticks higher. In addition, we expect the higher rates to increase the interest payments as a percent of GDP from recent lows of 1.5%, putting a modest strain on the U.S. balance sheet; the current rate is 3.8%. Lastly, the still-elevated valuation of the greenback implies that other currencies -- and even gold or other commodities -- are possibly undervalued, and we would expect investors such as the petrodollar-fueled sovereign wealth funds to bid up those values at a measured pace over time. For global investors, a higher dollar is a positive factor for export companies (particularly from China), as their goods become relatively cheaper in the global marketplace. But a higher dollar also can generate higher commodity prices, imported inflation, higher interest payments on global borrowings, and ultimately trade wars as U.S. exports stall.

Alibaba is the world’s largest online and mobile commerce company as measured by gross merchandise volume. It operates China’s online marketplaces, including Taobao (consumer-to-consumer) and Tmall (business-to-consumer). The China commerce retail division is the most valuable cash flow-generating business at Alibaba. Additional revenue sources include China commerce wholesale, international commerce retail/wholesale, local consumer services, cloud computing, digital media and entertainment platforms, Cainiao logistics services, and innovation initiatives/other.

Meta Platforms operates the world's largest family of social networking websites, including the flagship Facebook site, Instagram, Facebook Messenger, WhatsApp, Reels and Threads. The sites enable users to communicate with friends and family by posting to the site; commenting on others' posts; sharing photographs, website links, and videos; and messaging and playing games. The company also partners with application developers to add functionality to the sites, and allows users to pay for virtual goods and services through its Payments function. Meta derives about 55% of its revenue from outside the U.S. and Canada. Facebook/Meta went public on May 18, 2012. Meta Platforms changed its ticker from FB to META on June 9, 2022.