China steps up military exercises around Taiwan

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China has conducted its largest military exercises in three weeks around Taiwan in its first active response to the election of Lai Qingde as president over the weekend.

According to Taiwan’s Ministry of Defense, the People’s Liberation Army conducted a joint air-sea combat patrol near Taiwan last night, with 24 PLA aircraft and five PLA Navy ships operating in the area.

The People’s Liberation Army’s operation was the largest air exercise since Dec. 28 and violated the Air Defense Identification Zone, a self-declared buffer zone.

They follow the election of Mr. Lai’s Democratic Progressive Party, which won an unprecedented third term in power on Saturday.

Here’s what else we’re watching today:

• Davos Day 4: Israeli President Isaac Herzog speaks at the World Economic Forum. Stay up to date with local coverage and live events from Switzerland.

• Economic data: The number of first-time claims for state unemployment benefits is expected to increase by 5,000 last week to a seasonally adjusted 207,000, according to the U.S. Department of Labor’s weekly report.

• Financial policy: Atlanta Fed President Rafael Bostic speaks at an event in Atlanta. The European Central Bank has published the minutes of its latest rate-setting meeting. Find out more about rate-setters’ fight against inflation by signing up to Chris Giles’ central bank premium newsletter, or upgrade your subscription here.

• Company performance: Sandal brand Birkenstock has reported its first financial results as a publicly traded company since going public in New York in October. After a slow start, Birkenstock stock has risen and is now trading above its offering price.

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2. Pakistan carried out a pre-dawn attack on a suspected extremist base in Iran. The attack in Iran’s Sistan-Baluchestan province was carried out in retaliation for Tehran’s attack on a Pakistan-based jihadist group on Tuesday. The military escalation between Iran and Pakistan has raised concerns that rising tensions across the region could threaten broader conflict. Here’s the latest information from local reporters:

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5. The US Court of Appeals has allowed the ban on Apple’s Watch Series 9 and Ultra 2 to be reinstated. This is the latest setback in a dispute between the tech giant and health technology company Masimo over patents for blood oxygen tracking. Click here to learn more about the court’s decision.

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In October 2019, hundreds of wedding guests flew in from all over the world to witness Lars Windhorst and his bride marry at the Hotel du Cap Eden-Roc, the largest resort on the French Riviera. . Lionel Richie, Craig David and Lenny Kravitz serenaded the newlyweds. But the real VIPs in attendance that day weren’t celebrities. It was a tall, tanned Frenchman named Bruno Crastes, one of the most talented fund managers of his generation. But the relationship between Crastes and Windhorst would tarnish the French reputation and disrupt the world of high finance.

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chart of the day

Morgan Stanley’s market capitalization premium over Goldman Sachs comes after Goldman Sachs warned this week that its core wealth management business, which has made it a Wall Street darling, will fall short of its profitability targets in the near future. It is shrinking. At yesterday’s closing prices, the valuation difference between the two companies was the lowest since September 2020.

Take a break from the news

Generative artificial intelligence has the potential to change our understanding of the animal kingdom. The FT’s audiovisual team is researching how the same technology that powers ChatGPT could eventually be able to understand and even speak animal languages.

Correction: Earlier this week, I misspelled Federal Reserve Board Director Christopher Waller’s last name. We apologize for the error.

With Tee Zhuo benjamin wilhelm