Apple sues OpenAI for trade secret theft, Mahmood expected to be appointed Chancellor, and Hong Kong set to adopt five-year planning

Welcome to this week’s Market Pulse, your 5-minute update on key market news and events, with takeaways and insights from the Sidekick Investment Team.

Today, we’re looking at Apple’s landmark lawsuit against OpenAI, what Shabana Mahmood’s expected appointment as Chancellor means for the UK, and why Hong Kong’s first five-year plan reflects a global shift.

But first, our number of the week…

0.1%

That’s how much the UK economy grew in May, bouncing back from a 0.1% contraction in April. The figure was in line with expectations, but masks a complex picture: services grew, while construction and production both shrank.

Sidekick Takeaway: The headline number is a welcome gift for the incoming prime minister, but the backdrop is challenging. Oil prices remain elevated on Iran tensions, and the UK continues to sit on the knife-edge of contraction.

Only have a minute to read? Here’s the TL;DR:

• Apple has sued OpenAI for trade secret theft, alleging that the company directed former employees to bring proprietary information to interviews. The lawsuit could chill OpenAI’s recruitment pipeline and slow its hardware ambitions, even as its first device remains on track for announcement this year.
• Andy Burnham is reportedly set to appoint Shabana Mahmood as Chancellor, passing over early favourite Ed Miliband. Yields fell on the news, but Mahmood has never held a major economic brief, with some analysts describing her policies as a ‘blank slate.’
• Hong Kong is adopting its first five-year plan, aligning with Beijing’s national blueprint. The move is symbolic, but fits a broader pattern of governments directing capital toward strategic sectors – including in the US, the EU, and the UK.

It’s important to note that the content of this Market Pulse is based on current public information which we consider to be reliable and accurate. It represents Sidekick’s view only and does not represent investment advice - investors should not take decisions to trade based on this information.

Once Bitten: Apple’s Lawsuit Threatens OpenAI’s Hardware Ambitions

Over the past few years, OpenAI has assembled one of the most ambitious hardware teams in Silicon Valley.

And that team has its roots in one place above all others: Apple.

In 2025, OpenAI acquired former Apple designer Jony Ive’s startup for $6.5 billion. The company now employs more than 400 Apple workers.

Now, Apple is firing back, filing a landmark lawsuit against OpenAI for trade secret theft.

Damning allegations, legitimate needs

Apple’s lawsuit isn’t just about poaching employees. The iPhone maker is accusing OpenAI of stealing its intellectual property ahead of a highly anticipated hardware rollout:

• Apple alleges that former employees were expected to bring proprietary information to their interviews, and that OpenAI’s hardware chief developed a checklist to help recruits evade security procedures.
• Apple is seeking damages and an order to halt the conduct. OpenAI has responded that it has ‘no interest in other companies’ trade secrets.’
• The allegations are serious, but the recruitment drive has its logic. Few Silicon Valley firms have genuine hardware expertise, and OpenAI needs talent if it wants to build a credible device.

OpenAI’s first hardware product is still on track for announcement this year.

But if Apple’s allegations have teeth, the lawsuit could slow OpenAI’s broader hardware ambitions.

Sidekick Takeaway: The lawsuit is a sharp reversal between two firms that once partnered to integrate ChatGPT into Siri. Amidst OpenAI’s hardware recruitment, however, Apple has increasingly turned to Google to fulfil its AI needs.

Chancellor Check: What Mahmood’s Appointment Tells the Market

In just a few days, Andy Burnham is set to begin his premiership of the UK.

But until this week, there was little clarity over who would serve as Chancellor, fuelling concern over whether he had a coherent economic plan.

Now, reports indicate that Burnham will appoint Shabana Mahmood as Chancellor.

By passing over early favourite Ed Miliband, Burnham has provided a clear signal of fiscal continuity, rather than a sharp change of direction.

Markets exhale, but questions remain

In response to the reports, markets breathed a sigh of relief. However, questions about Mahmood’s economic policy remain:

• The 30-year gilt yield, which is particularly sensitive to fiscal and political risk, closed lower on the news.
• Mahmood is seen as a more pragmatic choice than Miliband, who attracted the lowest level of investor support in a recent Bloomberg survey.
• However, Mahmood has never held a major economic brief, and has said little about her fiscal policy – described by some analysts as an economic ‘blank slate’.

Although Burnham has yet to formally announce Mahmood as his choice of Chancellor, it seems clear that signalling fiscal pragmatism is a priority.

Sidekick Takeaway: The market’s initial relief is understandable, but it may be premature. Mahmood is still an untested quantity on economic policy, and Burnham has already warned that fiscal decisions will be ‘difficult.’

Plan B: Hong Kong’s Five-Year Plan and Global Industrial Policy

For 25 years, Hong Kong topped the Index of Economic Freedom, widely seen as the definitive ranking of the world’s most open economies.

But a few years ago, Hong Kong was dropped from the index on increased control from Beijing. Now, the city’s transformation from a free market hub is all but complete.

Following public consultation this summer, Hong Kong will adopt its first five-year plan, set to align with China’s national blueprint.

In many ways, Hong Kong’s five-year plan is the sharpest example of a trend that’s accelerating across major economies.

Industrial policy everywhere

Hong Kong’s shift is symbolically striking, but fits a global pattern:

• The plan formalises Hong Kong’s transition toward a greater use of public spending to reshape the economy, rather than trusting markets.

• And Hong Kong isn’t alone in this approach: the US is reshoring supply chains, the EU is pursuing self-sufficiency in critical minerals, and the UK has leaned into sector-specific industrial strategies.

• Free-market orthodoxy is in global retreat, but the trade-offs are real. Public money flowing into infrastructure, defence, and supply chains can introduce subsidy distortions and capital efficiency concerns.

This trend reflects a growing acknowledgment that today’s challenges are too big for private capital to solve alone.

For governments, the right balance ensures that industrial policy doesn’t introduce issues greater than the ones it’s meant to solve.

Sidekick Takeaway: For investors, the lesson is practical: opportunities could follow public spending. As governments seek to leverage public balance sheets and mobilise private capital, expect to see more deals in areas like defence and manufacturing.

Notices

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