The stock market rally came under pressure, with the Nasdaq breaking below its 50-day line as Treasury yields soared. Growth leaders such as Tesla (TSLA), Nvidia (NVDA), Square (SQ) and Teladoc Health (TDOC) were selling off, with the latter three reporting earnings. Tesla stopped taking orders for its brand-new low-end Model Y SR+ while also suspending some Model 3 output. Etsy (ETSY) jumped on earnings after tumbling ahead of results.
Stock Market Rally Under Pressure
The stock market rally moved from “confirmed uptrend” to “rally under pressure.”
The Nasdaq tumbled below its 50-day line, with speculative growth names selling off hard, tumbling below support or erasing big gains. The S&P 500 fell solidly, but found support at its 50-day line. The Dow Jones, buoyed by cyclical and financial stocks, hit a record high Wednesday before retreating late in the week. The 10-year Treasury yield rose sharply, topping 1.6% briefly on Thursday before paring gains.
Tesla Pulls Model Y SR+, Halts Model 3 Output
The EV maker stopped taking orders for Model Y Standard Range from its website just over a month after it was launched and less than week after a price cut. The SR+ is still available “off menu.” Tesla (TSLA) cut $1,000 off the price of the Model 3 and Y Long Range Dual Motor AWD. The Model Y LR now goes for $48,990, and the Model 3 LR costs $45,990. Tesla also paused production of Model 3 sedans at its Fremont plant for two weeks, according to one report. A leaked Elon Musk email suggested that all of Fremont was shut for a “few days,” blaming chip shortages. But it also might reflects weak North America demand.
EV Startups Report
In a busy week for EV stocks, Nikola (NKLA) posted a 17-cent loss, narrower than expected, and expects to start generating EV revenue from its upcoming Tre semi-truck in fiscal 2021. China’s Li Auto (LI) swung to a two-cent profit per ADS as revenue jumped 65% quarter over quarter. Hyliion Holdings (HYLN) and Fisker (FSR) reported smaller-than-expected losses on no revenue. Fisker will partner with iPhone maker Foxconn on a new EV. Meanwhile, Churchill Capital Corp IV (CCIV) confirmed that it will take Tesla challenger Lucid Motors public in a deal valuing latter at $24 billion, one of the largest SPAC deals ever. Workhorse Group (WKHS) lost a key USPS deal potentially worth billions to make a new generation of mail delivery trucks. Oshkosh (OSK) won the hotly anticipated and much-delayed contract. Workhorse stock dived on the news.
Nvidia Posts Beat-And-Raise Report
Graphics-chip maker Nvidia (NVDA) reported a 64% EPS gain for its fiscal Q4. Revenue rose 61% to $5 billion, the third straight quarter of accelerating sales growth. For the current quarter, Nvidia expects sales of $5.3 billion, up 72% and well above views. But shares fell sharply Thursday.
Salesforce (CRM) earnings rose 24% from a year earlier while…
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