Tesla Banished to “Demand Hell”
Futures are ticking higher this morning as investors push global growth concerns to the back burner.
Global markets inched higher this morning as China’s March exports jumped more than 14% compared to last year, MarketWatch reports, handily topping estimates. If the averages maintain their pre-market trajectories, new 2019 highs will carry us into the weekend.
But there’s still plenty of upcoming market-moving news on the horizon. First-quarter earnings are starting to trickle in, with JP Morgan (NYSE:JPM) set to open at new year-to-date highs after the bank topped analyst expectations, crediting its earnings beat to “a strong economy.”
Another Dow stock, Chevron Corp. (NYSE:CVX) is making headlines as it announces a proposed $33 billion buyout of Anadarko Petroleum Corp. (NYSE:APC). The Street’s not sure what to make of this deal just yet, sending Chevron shares deep into the red to kick off the trading day.
As Wall Street sifts through this morning’s fresh earnings reports, Telsa is slammed with more bad news…
Tesla Inc. (NASDAQ:TSLA) shares fell nearly 3% yesterday after Asian-market newspaper Nikkei reported that Panasonic is pulling the plug on its partnership with Tesla to expand the company’s Nevada Gigafactory.
Citing concerns with Tesla Model 3 demand, Panasonic and Tesla didn’t think it made financial sense to expand the Gigafactory. According to the report, Panasonic is also suspending its investments in Tesla’s Shanghai plant.
Telsa has already bashed the report in a statement, claiming the company’s relationship with Panasonic is still peachy and they’re getting more bang for their buck improving existing production equipment. Still, the news is stoking Wall Street’s fears over bigger problems that could sink Tesla’s prospects just at the company unveils its new Model Y SUV.
“Tesla has a demand problem,” Vertical Group analyst and prominent Tesla bear Gordon Johnson told Business Insider. “The demand problem is the Model 3 is not a mass-market car. It’s a luxury car.
“Elon Musk has talked about production hell, delivery hell. I think what they’re in now is demand hell.”
This story continues to develop this morning, as the WSJ just reported Tesla will stop selling it’s the $35,000 base model online. Customers will now have to call or go to a Tesla store to order one, raising the minimum price of the Model 3 by nearly 13% for online shoppers, the WSJ reports.
As for Elon, he’s too busy fawning over SpaceX’s Falcon Heavy launch last night to worry about earthbound issues…
Finally, the market’s handing you the perfect opportunity to book double-digit gains ahead of the weekend.
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OKTA has closed higher for five consecutive trading days as it pushes toward the $100 mark for the first time. Let’s take this opportunity to sell into strength and book a solid winner to close out the trading week.
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