This week, TSMC posted 40% year-on-year revenue growth, the UK housing market showed its first signs of life in years, and US-China trade tensions quietly de-escalated.

None of this made the headlines in the way it should have — but all of it matters. These are the sorts of signals I look for.

At W4.0, I share a weekly briefing like this one. Not a recap of news, but an interpretation of what actually matters to long-term thinkers — and how I’m positioning around it.

If you’re already reading Woodford Views, you’re probably looking for that kind of thinking. At W4.0, my new investment strategy platform, I go a step further: sharing the actual strategies I've created, the companies in those strategies, and the logic behind both.

A trade thaw that could ease pressure on tech

This week’s China–US trade talks in London restored the truce that had recently looked in danger. The breakthrough appears to settle disputes over rare earth exports and US chip controls, two sticking points that had threatened to reignite tension.

It’s not over. My guess is we’ll still see higher tariffs on Chinese exports in the final agreement, but the fact that both sides want to avoid escalation is encouraging. With tech supply chains still tightly interlinked, this détente matters more than the headlines suggest.

Political theatre in Westminster — but not much substance

Back in the UK, the Chancellor’s spending review got plenty of attention, mostly because it’s pitched as a major fiscal moment. But it’s more politics than economics.

• The overall spending envelope was already announced back in the Spring Statement.
• The main “new” news was how that spending would be divided up across departments.
• It’s worth noting: this only covers departmental spending, the bit government controls directly. The larger chunk, including pensions, welfare, and interest, falls under annual managed expenditure and is far less flexible.

The media used this as another cue to predict tax hikes, but I think that’s unlikely. If I’m right about the UK growth trajectory, the Chancellor will have more fiscal headroom than most commentators expect.

Under the surface: UK labour and GDP data tell a more positive story

Not much noise in the macro data this week, but a few signals worth noting.

• The ECB cut interest rates again after softer inflation numbers. Its deposit rate is now 2%, less than half the UK’s 4.25%.
• UK labour market data showed a slight softening. Unemployment ticked up, but that’s because more people joined the workforce than found jobs, not because of layoffs. Encouragingly, wage growth slowed, which should be welcomed by the Bank of England.
• Output growth has continued to outpace hours worked, a good sign for UK productivity.

We also saw April’s UK GDP data, a 0.3% contraction after five months of growth. I remain sceptical of the ONS’s approach to monthly GDP (as far as I know, no other developed economy reports it this way), and I wouldn’t be surprised if this figure is revised upward.

If May and June data come in as I expect, the UK will likely show ~0.5% average quarterly growth, in line with the long-run trend. I continue to hold a more bullish view on the UK economy than most.

Two sectors showing real signs of recovery

Not every company update matters — but two stood out this week for what they signal about broader trends.

1. Semiconductor strength: TSMC surprises to the upside

TSMC isn’t in any W4.0 strategies, but its May revenue report matters. Sales were up 40% year-on-year, far ahead of expectations.

After two tough years of inventory overhang and weak pricing, this looks like a clear signal that the global chip cycle is turning. That’s relevant for several W4.0 strategies with semiconductor exposure: Unstoppable Trends and Neil’s Top 40.

2. UK housing: early signs of a recovery

Confidence is returning to the UK housing market. Completions are up, rates are falling, banks are lending again, and build cost inflation is easing.

This is still a fragile recovery, but for the first time in three years, conditions are improving, and several housebuilders and materials companies look like they could be meaningfully mispriced.

All three of these strategies have exposure to the sector:

• ‍Neil’s Top 40‍
• All Rounder‍
• ‍Income Booster

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