Tesla’s Triumph [3 Must-See Charts]
What a week!
The bears were licking their chops as the averages drifted lower Monday morning. A social media meltdown courtesy of Facebook and Twitter stock convinced short sellers to search for fresh meat in the tech sector following the high-profile drawdowns.
But a deeper correction never materialized. Tech stocks stabilized — then blasted higher Thursday.
Traders are now looking to close out the week on a positive note as futures push into the green this morning.
Here are the charts that have everyone talking…
1. Musk wins this round…
I think it’s safe to call Tesla Inc. (NASDAQ:TSLA) the market’s most divisive stock. Love or hate Tesla, you have to admit that the saga has gotten a lot more entertaining ever since Elon Musk ramped up his Twitter trolling.
Musk is no stranger to controversy. The erratic CEO spent most of the week taunting short sellers, including prominent fund manager David Einhorn. But this time, he had the goods to back up his bullish talk. Tesla defied the skeptics and finished higher by more than 16% following its latest earnings release.
“The stock had its best day since December 2013 when it gained 16.53 percent,” CNBC reports. “It’s a welcome stock bump for investors, who sent Tesla shares skidding more than 5 percent after the company’s last earnings report in May and Musk’s bizarre comments during the earnings call with analysts.”
Short sellers aren’t exactly pleased this morning. They’re now sitting on paper losses approaching $2 billion following the post-earnings rally, according to MarketWatch.
That has to hurt…
2. Tech stocks hold the line
Turning to the broader tech sector, concerns over a bigger drawdown all but vanished late this week following a picture-perfect bounce in the Nasdaq Composite.
The tech-heavy Nasdaq retreated from all-time highs to its 50-day moving average in just four trading days. But the bulls held the line. A small bounce on Wednesday morphed into a massive tech rally that vaulted the Nasdaq higher by nearly 1.25% Thursday.
So much for that epic meltdown everyone was screaming about just a few days ago…
3. Don’t forget about Amazon
Apple is monopolizing the financial headlines as the stock’s market value briefly topped $1 trillion for the first time.
But let’s not sleep on Amazon…
“Amazon.com Inc.’s dominance in online retail is clear to see: The so-called Everything Store captures 49 percent of retail e-commerce sales in the U.S., thanks in large part to its 95 million-strong army of Prime customers, who in July contributed to an estimated $4 billion spent globally in just 36 hours during a promotional binge that Jeff Bezos created out of thin air,” Bloomberg reports in a new in-depth feature. “For comparison, that’s more than Church & Dwight, maker of Arm & Hammer baking soda and Trojan condoms, generates in a year.”
Sure, everyone knows about Amazon’s domination of the e-commerce space. But there is one chart that stood out to me this week that proves how powerful Amazon has become:
Simply put, Amazon is light-years ahead of the competition when it comes to converting its website visitors into buyers. And it’s not even close.
As you’ve probably guessed, Amazon shares rallied with the broader tech sector yesterday. The stock is now just 2.5% away from its all-time highs.