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Markets are on a winning streak, so why is Tesla struggling?

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The S&P 500 extended its remarkable winning streak, reaching an all-time high for the fifth consecutive session, fueled by robust U.S. economic growth data for the fourth quarter.

Meanwhile, electric vehicle giant Tesla faced a significant setback as it tumbled in response to a disappointing sales forecast.

This recent surge in the S&P 500 marks the first time in two years that it has achieved record highs, driven by optimism about the economy, lower interest rates, and growing investments in artificial intelligence.

Tesla experienced a sharp decline of 12%, hitting its lowest point since May 2023.

Impacted margins

CEO Elon Musk’s warning of slower sales growth in the coming year, despite price reductions that have negatively impacted margins, contributed to this decline.

As a result, Tesla’s market value dropped to approximately $580 billion, falling below Eli Lilly (LLY.N) and just above Broadcom (AVGO.O).

Contrary to predictions of a recession following the Federal Reserve’s aggressive interest rate hikes, the U.S. economy exhibited faster-than-expected growth in the December quarter, with a full-year growth rate of 2.5%.

Strong consumer spending played a pivotal role in this economic resilience.

Jobless claims

Additional data revealed that initial jobless claims for the week ending January 20 rose to 214,000, exceeding the estimated figure of 200,000.

Investors are eagerly anticipating quarterly results from tech giants such as Apple (AAPL.O), Microsoft (MSFT.O), Amazon (AMZN.O), Alphabet (GOOGL.O), and Meta Platforms (META.O) in the coming week, which will provide insights into whether their high valuations are justified after significant stock surges since 2022.

EV losses

Following Tesla’s quarterly report, other electric car manufacturers also experienced losses. Rivian Automotive (RIVN.O) dropped 2.2%, and Lucid Group (LCID.O) fell by 6.7%.

American Airlines (AAL.O) reported a 10.3% increase as it predicted upbeat annual profits.

Highest consumer financial stress level in three years

Among the S&P 500 companies that have reported earnings thus far, an impressive 82% have exceeded expectations, surpassing the long-term average beat rate of 67%.

Boeing (BA.N) faced a 5.7% decline after the U.S. Federal Aviation Administration prohibited the troubled planemaker from expanding the production of its 737 MAX narrowbody planes.

Advancing stocks outnumbered declining ones within the S&P 500 (.AD.SPX) with a ratio of 4.0 to one. The S&P 500 marked 50 new highs and two new lows, while the Nasdaq recorded 97 new highs and 119 new lows.

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Divorce spike in Australia triggers hidden tax risks

Australia sees increased divorce filings amid emotional challenges, with many couples overlooking significant tax pitfalls in their settlements.

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Australia sees increased divorce filings amid emotional challenges, with many couples overlooking significant tax pitfalls in their settlements.


Australia is facing a sharp rise in divorce filings over the past two months — but as couples navigate emotional breakups, many are missing major tax traps hidden in their settlements.

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#Divorce #TaxRisks #AustraliaNews #FamilyLaw #FinanceTips #TickerNews #HiddenCosts #Superannuation

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Stocks rebound despite tariff concerns and earnings anticipation

US stocks rebound amid tariff uncertainty; key earnings reports and economic data loom as volatility persists in the market.

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US stocks rebound amid tariff uncertainty; key earnings reports and economic data loom as volatility persists in the market.

In Short

The stock market recovered after an early decline, led by companies like Boeing and IBM.

Investors are cautious ahead of upcoming economic data and potential trade developments, with projections of a 7% drop in S&P 500 earnings by 2025 due to tariffs.

A late recovery in the stock market reversed an early decline as dip buyers entered during a volatile day.

On Monday, the S&P 500 completed its fifth reversal of 1% or more in a month, matching the total seen throughout 2024. Gains were led by Boeing and IBM, while Nvidia fell following Huawei’s announcement regarding a new chip. Major tech companies, including Microsoft and Apple, are expected to report earnings soon.

Short-term Treasuries performed better, and the dollar weakened amidst ongoing economic data releases.

Economic data

The upcoming week promises substantial economic data, with reports on jobs and inflation due. A Texas manufacturing survey revealed significant weakness, with executives describing the tariff situation as chaotic.

Experts predict an eventful week, with potential for market volatility driven by various trade and economic headlines. Investors are particularly attuned to trade relations with China, with outlooks hinging on government actions.

Despite some executives remaining uncertain about tariff impacts, analysts are calculating potential effects on corporate earnings. Bloomberg Economics projects net income for the S&P 500 could drop around 7% by 2025 due to elevated tariff rates, compared to previous growth expectations.

Morgan Stanley suggests that a weak dollar may help US earnings, keeping the S&P 500 within a 5,000 to 5,500 range unless trade agreements with China are made, alongside a rebound in earnings and potential easing of monetary policy.

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Busy week: big tech earnings, U.S. jobs data

Busy week for markets with major tech earnings and U.S. jobs data shaping investor sentiment amid trade uncertainties.

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Busy week for markets with major tech earnings and U.S. jobs data shaping investor sentiment amid trade uncertainties.

In Short

Next week, major tech companies, including Apple and Microsoft, will report earnings alongside key economic data, amid ongoing global trade concerns.

The S&P 500 has seen some recovery but remains down 10% since February, with investors anxiously awaiting the U.S. jobs report and economic growth indicators.

Next week, U.S. markets anticipate significant activity as big tech companies release earnings and crucial economic data is reported.

Investors will focus on corporate results from major firms like Apple and Microsoft, alongside the U.S. jobs report and first-quarter economic growth data. This comes amidst ongoing concerns related to global trade that could affect market stability.

The S&P 500 index has seen modest recovery recently, cutting its previous losses but still down roughly 10% from February’s peak. Optimism has been partially driven by indications of a softer trade approach from the Trump administration.

Market sensitivity

Michael Mullaney of Boston Partners noted that stock market sensitivity remains high, responding rapidly to any shifts in tariff news. Recent easing of trade tensions, including a pause in major tariffs announced by Trump, has contributed to market gains, but uncertainty continues.

In the forthcoming week, about 180 S&P 500 companies, accounting for over 40% of the index’s value, will announce their quarterly performance. Early reports indicate strong earnings growth, though some firms have lowered profit forecasts, highlighting potential challenges ahead.

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