US stocks down – manufacturing data and trade tariffs

The US equity markets were clearly down in New York on Wednesday. The global growth concerns related to recent manufacturing and car sales data were the primary reasons. Dow Jones lost 1,86 % to 26078 points, the S&P 500 -index 1,79 % to 2887 points and the technology Nasdaq-index declined 1,56 % to 7785 points.

The US manufacturing data showed the global growth concern is having impact on the US economy. The US China trade talks have put pressures on the US manufacturing and for example the Ford Motor Company released its car sales figures, which were showing a decline in the third quarter.  Also the declining figures in German manufacturing is one part of the global concern.

Tesla (TSLA) also announced its third quarter deliveries, which were approximately 97,000 vehicles, according to the company release. According to Tesla the total deliveries were at record level, but according to Reuters the deliveries were down to Wall Street expectations and the share fell over 6 % after the bell. Last week the CEO Elon Musk was quoting that the company may reach a six-figures deliveries.

The US also announced a new trade tariffs to the EU related to the WTO Airbus decision. The new tariffs would include 7,5 billion dollars worth of goods. According to Bloomberg this would mean a new 10 % tariffs to aircraft goods and 25 % tariffs on farming and other industrial items. The new tariffs would be effective by October the 18th.

In the UK the FTSE -index also declined 3,23 % to 7122 points. The UK Prime Minister Boris Johnson delivered the new Brexit proposal to the EU. The country is aiming the EU leaders summit on the October 17th in order to seek the deal with the EU.

In Germany the DAX-index closed down 2,76  % to 11925 points and in France the CAC 40-index declined 3,12 % to 5422 points.

 

 

 

 

Business Finance

Tesla considering Germany as a new factory site

The US electric car manufacturer Tesla (TSLA) is considering Germany´s North Rhine-Westphalia as a possible factory site in Europe. According to Rheinische Post the company has had negotiations with the local authorities regarding the issue.

According to Bloomberg, Tesla has said that Germany would be the leading choice for the European Gigafactory.

North Rhine-Westphalia is the biggest state in Germany and in the middle of German industrial manufacturing sites. The local area capitol is Dusseldorf.

Business Finance Tech

Tech stocks up in Wall Street – RealReal +12 %

The tech stocks soared up in Tuesday trading in New York. Apple´s (AAPL) stock closed up 4,23 % to 208,97 dollars due to the tariffs delays in the US China trade negotiations. Also retail gained and for example Amazon (AMZN) closed up 2,21 % to 1824 dollars. The tariffs delay is expected to help the Christmas shopping as well.

The re-used luxury online shop RealReal gained over 12 % in trading. The company published its second quarterly figures ending June 30th. According to the press release the total revenue gained 51 % to 71 million dollars from a year earlier and the average order value was 452 dollars. The net loss was 26,8 million dollars compared to the loss of 17,6 million dollars a year ago. The company had the IPO in the beginning of July.

Tesla (TSLA) was also up, 2,62 % to 235 dollars and Ralph Lauren (RL) also up 1,61 % to 93,41 dollars. The retail company Macy´s was also up, 0,41 % to 19,36 dollars. The company is to publish its figures on Wednesday.

Dow Jones- index closed up 1,44 % to 26 279 points, the large S&P 500 -index closed up 1,48 % to 2926 points and tech-index Nasdaq closed 1,95 % to 8016 points. Semiconductor sector index closed up 2,95 % to 1489 points.

Business Finance

Stocks tumbled in NY – hit by trade war

The financial markets tumbled today globally as a response to the tightening trade war between the US and China trade. The global economy growth was the main concern in the markets while the Chinese currency, yuan decreased to its lowest levels in decade, to around 7 per dollar. Last week the US President Donald Trump informed about the new tariffs in the China trade.

Dow Jones index closed down 2,9 % to 25 717 points, the S&P 500 index closed down 2,99 % to 2844 points and the tech-Nasdaq index down 3,47 % to 7726 points. The gold and Japanese yen increased.

Apple (AAPL) closed down 5,23 % to 193,34 dollars, ride-hailing company Uber (UBER)closed down 3,34 % to 39,05 dollars, IBM (IBM) closed down 4,41 % to 140,76 dollars, Microsoft (MSFT) closed down 3,43 % to 132,21 dollars and Walmart down 3,27 % 105,82 dollars. Luxury company Ralph Lauren (RL) closed also down 3,19 % to 95,73 dollars. The electric car manufacturer Tesla (TSLA) closed down 2,57 % to 228,32 dollars.

According to Bloomberg market analyst, the trade war could hit US jobs as early as the next two months. This would also increase the global pressures for more rate cuts by the central banks in Europe and in the US. Last week the Fed lowered its fed funds by 25 basis points for the first time since the financial crisis.

In Europe the stocks were also down. In London the FTSE 100 index closed down 2,47 % to 7223 points, in Germany the DAX-index closed down 1,80% to 11 658 points and in France the CAC 40 -index closed down 2,19 % to 5241 points.

In Asia the Hang Seng closed down 2,85 % to 26151 points in Hong Kong and the Nikkei 225 index closed down 1,74 % to 20720 points.

Business Finance

Elon Musk: Tesla service development is going mobile

The Tesla (TSLA) CEO Elon Musk said in the company conference call yesterday that Tesla´s service development is going mobile, more and more in the future.

-Our mobile service is part of the growing service development, while this is the best way to reach our customers, Musk said.

The company also said it has opened 25 new service locations globally and that they measure the new locations by traffic and driving time. The need for service development is essential while the Tesla fleet have doubled in a year and the growth expectations are also showing the same trend. Also service needs to be scaled.

According to Musk, the car service operations is one of the main drivers for the new car sales. For example during the Q2 period this year, the company generated orders at a high pace.

Tesla is also developing its automation within the cars and for example the automatic stopping at the stop signs and traffic lights is going to part of the new safety automations. The Model 3 has reached the highest ever safety standards in the US Safety Assist Category, the company said.

Business Finance Tech Travel

Tesla´s Q2 deliveries 95 356 – on track with China factory & Model Y

The US electric car manufacturer Tesla (TSLA) announced its second quarter results, which show that the company in on track with the Shanghai Gigafactory plant and with the new model, Model Y. It means the new factory would be ready by the end of this year and the new model by the fall 2020.

The company said its Q2 deliveries were 95 356 vehicles and they reach a record production of 87 048 vehicles. During the period Model 3 deliveries were 77 634 vehicles and the average selling price (ASP) was around 50.000 dollars. Tesla also said it expects its weekly production reach 10.000 by the end of the year. The total annual production expectation remained at 360.000- 400.000 vehicles.

The free cash flow was 614 million dollars. The car revenue was 5,3 billion dollars compared to 3,7 billion dollars in the previous quarter. The loss of car operations was 167 million dollars compared to 521 million dollars in the previous quarter and 621 million dollars a year earlier. The CEO Elon Musk said in the conference call that he expects the company to turn profitable during the rest of the year.

Business Finance

Stocks markets rally – rate cut & QE possible

The stock markets rallied on Tuesday, when Federal Reserves Chairman Jerome Powell signalled a possible interest rate cut if needed. He was referring to the trade negotiations between the China and US. Also some markets estimates that the ECB, The European Central Bank, would start again the quantitative easing actions from January, lifted the trade worries.

Dow Jones index ended up 2,06 % to 25 332 points, S&P 500 index ended up 2,14 % to 2803 points and the technology-index Nasdaq closed up 2,65 % to 7527 points. According to Bloomberg News, this increase was the biggest since January.

The big banks and the car manufacturers were the leading sectors. The economic slowdown due to the trade tariffs between the China and US has been pushing the stocks downward trend.

The recent IPO-companies were mixed, the Uber (UBER) closed up 3,64 % to 42,53 dollars, while Lyft (LYFT) closed down 0,62 % to 59 dollars. The market speculation which of the new companies would power the better way to autonomous future continued. The electric car manufacturer Tesla (TSLA) closed up 8,17 % to 194,50 dollars.

From the financial markets side, Goldman Sachs (GS) ended up 3,65 % to 190,40 dollars and JP Morgan (JPM) closed up 3,08 % to 109,77 dollars.

The global economic situation was also in the World Bank´s new economic estimate on Tuesday, that the global economy is decreasing next year due to the trade situation. -Global economic growth is forecast to ease to a weaker-than-expected 2.6% in 2019 before inching up to 2.7% in 2020, the World Bank says.

The Dutch banking group ABN Amro said in their review that they expect the European Central Bank to start the quantitative easing program again in January 2020. They expect the buying of bonds start from 70 billion euros next year and that the ECB would need to rise the issuer limit from 33 % to as high as 50 %.

It is expected that this new policy decision will be given to the new ECB president, which is going to be elected during this year as part of the EU top jobs puzzle. Mr Mario Draghi is leaving the central bank during this year. The ECB is having its next Governing Council meeting on Thursday in Vilnius, Lithuania.

In Europe, the stocks ended also up and the FTSE 100 index closed up 0,41 % to 7214 points in London. In Germany the DAX-index closed up 1,51 % to 11971 points and in France the CAC 40 index ended up 0,51 % to 5268 points.

The euro was trading flat at 1,125 dollars and the sterling was up 0,01 % to 1,2699 dollars.

Business Finance