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🗓️ The Daily Ledger - 19 May 2025

  • zacharymenzies
  • May 19
  • 3 min read

Updated: May 20

This edition of The Daily Ledger breaks down six developments shaping investor strategy — from Hong Kong’s rally to new rules in buy-now-pay-later lending.



🧾 1. SPACs Stage a Comeback Amid Regulatory Softening

What happened: A new wave of boutique banks is reviving interest in SPACs, with 44 deals raising $9 billion so far this year, nearly matching all of 2024 (total of $9.6bn). SPACs, which let private firms go public via a merger, were once popular during the pandemic. Tighter rules had slowed the trend, but investors expect a more relaxed stance from the SEC under Trump’s new appointee.

Why it matters: SPACs are often used to back early-stage or high-growth businesses. If they return in force, we could see more investor demand for newer companies with higher risk and return potential.

My Insight: Be prepared for more clients asking about SPAC-related funds or strategies. Make sure they understand the risks.

What to Watch: Whether new SPACs coming to market are better quality than those seen during the 2021 boom.



🤝 2. UK and EU Near Major Post-Brexit Deal

What happened: Britain and the EU are close to agreeing a deal to improve trade and cooperation. Talks are ongoing over fishing rights, food rules and youth travel.

Why it matters: Better UK-EU relations could help British companies that trade with Europe, especially in sectors like agriculture and transport.

My Insight: Stronger trade ties could lift demand for UK equities, especially in small- and mid-cap names.

What to Watch: Final agreement wording on trade and mobility — it could move market sentiment quickly.



⚙️ 3. Rare Earth Exports From China Resume — But Slowly

What happened: China has restarted rare earth exports, but approvals are moving slowly under new export rules. These materials are crucial for making things like EVs, wind turbines and military tech.

Why it matters: Delays could affect global supply chains in green energy, electronics and defence sectors.

My Insight: Check whether portfolios rely on companies that could be hit by supply shortages or rising input costs.

What to Watch: Whether companies start shifting production or sourcing to reduce reliance on China.


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🏦 4. BNPL Lenders to Be Regulated Like Banks

What happened: The UK government is bringing “buy now, pay later” lenders under full financial regulation. These firms will need to follow rules similar to banks, including customer affordability checks.

Why it matters: Stronger rules could make the sector safer for consumers but may slow growth for some providers.

My Insight: This makes the BNPL space more stable — and potentially more attractive — for long-term investors.

What to Watch: How big BNPL players adapt and whether new competition enters the market.



🍷 5. Alcohol Sector Under Pressure From Changing Habits

What happened: Drinks companies like Moët and Asahi say sales are falling. Younger people are choosing other forms of entertainment or reducing alcohol for health reasons. Ireland will soon introduce warning labels on alcohol, similar to tobacco.

Why it matters: This could be the start of a bigger lifestyle shift away from alcohol, hurting future demand.

My Insight: Portfolios holding drinks companies may need to adjust if this trend continues long term.

What to Watch: If more countries follow Ireland with health warnings, it could accelerate consumer change.



📈 6. Hang Seng Outperforms Mainland Markets as Cash Flows In

What happened: Hong Kong’s Hang Seng index is up over 16% this year, while China’s main CSI 300 is down. Investors are moving money out of mainland markets due to concerns about China’s economy.

Why it matters: This shows growing investor preference for Hong Kong as a way to get China exposure with fewer risks.

My Insight: Review how clients are invested in China — Hong Kong-listed shares may offer better access and liquidity right now.

What to Watch: Whether this trend continues and changes how index funds and global investors allocate to China.



Consultant's Watchlist

  • 🧾 Could SPAC activity drive more demand for private market access?

  • 🤝 Will a stronger UK-EU deal bring new life to overlooked UK stocks?

  • ⚙️ Are supply chain risks building in green energy and tech sectors?

  • 🏦 Does regulation make BNPL a safer play for long-term capital?

  • 🍷 Is alcohol losing its place as a reliable ‘defensive’ investment?

  • 📈 Are investors shifting their China exposure from mainland to Hong Kong?

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