Stock recap
WEEKLY STOCKS RECAP
IN TECH
Tesla’s delivery delay, additional price cuts
After summer factory upgrades, Tesla (NASDAQ:TSLA) reported 435,059 Q3 EV deliveries, missing Wall Street projections of 456,722.
The EV powerhouse produced 430,488 vehicles in the quarter, below the estimate of 461,992. As it upgraded facilities, Tesla predicted a dip from Q2, adding, “Our 2023 volume target of around 1.8 million vehicles remains unchanged.”
Wedbush Securities, which rates Tesla shares Outperform, blamed the loss on longer-than-expected factory downtimes in Shanghai and Austin, Texas, which necessitated the move of 20,000 units into the fourth quarter.
In a note on Monday, Wedbush called the Model 3 refresh front and center in China and Cybertruck production set to kick off around Halloween tailwinds for the stock in the coming year.
Later that week, the business stated it would again lower costs on its popular EVs in the US, lowering the Model 3 sedan to $38,990 from $40,240 and the long-range Model 3 to $45,990 from $47,240.
The performance model dropped to $50,990 from $53,240, while the Model Y dropped to $52,490 from $54,490.
Tesla shares originally fell on both announcements, then rose 6.4% to $260.53 by week’s end. Year-to-date, shares are up 140%.
After actors strike, Netflix pricing may rise: report
The Wall Street Journal reports that Netflix (NASDAQ:NFLX) would raise the price of its ad-free service in various countries a few months after the Hollywood actors’ strike ends.
Sources tell the WSJ that Netflix will certainly raise prices in the US and Canada, but they don’t know how much or when.
The WSJ reported a 25% price increase in major ad-free streaming services over the past year as streaming providers try to increase profits without losing customers.
Netflix rose 1.2% weekly to $381.51 after Monday’s open.
On debt offering and preliminary numbers, Rivian falls.
After poor preliminary Q3 numbers and a $1.5 billion green convertible senior unsecured note issuance the night before, Rivian Automotive (NASDAQ:RIVN) shares fell 23% Thursday.
The loan offering includes a $225 million option to extend the company’s cash runway to 2025. The notes can be redeemed for cash between October 2027 and September 2030, depending on share price performance.
Q3 sales are expected to be between $1.29B and $1.33B, slightly below market estimates.
Truist maintains a Buy rating and $30 price target on the company, stating that the announcement “largely meets expectations and reflects RIVN’s opportunistic capital raise strategy.”
Although they expected a retreat, they said, “With most of the unknowns out of the way, we anticipate an increasingly favorable setup entering the 3Q print.”
The shares fell 20.7% to $18.92 from Monday’s opening price.
Apple altering App Store rules as China tightens
Since recently, Apple (NASDAQ:AAPL) requires new apps to get a Chinese government license before being launched.
Apple joins local companies that implemented this policy years ago to comply with China’s stricter regulations.
Many overseas app developers struggle to obtain the new “internet content provider (ICP) filing” license, which requires a presence in China or a local publisher.
Apple had a more lax ICP filing policy, which allowed it to sell more mobile apps than local rivals and boost its popularity in China, its third-largest market.
Shares rose 3.7% to $177.49 this week from Monday’s open.
IN EV SPACE
BYD challenges Tesla for EV lead
Chinese EV maker BYD (SZ:002594) appears to be closing in on Tesla (NASDAQ:TSLA) in the EV dominance race: As a surprise, BYD may rival Tesla for battery EV (BEV) sales after Tesla’s Q3 delivery stats fell short.
Tesla’s recent quarterly reports showed weak delivery numbers, raising questions about their EV market supremacy. Tesla’s Q3 sales fell 6.7%, its first quarterly dip since early 2020, as decreasing demand has caused pricing wars in both the Chinese and American markets.
Chinese giant BYD, backed by Warren Buffett’s Berkshire Hathaway (NYSE:BRKa) (NYSE:BRKb), has taken this chance to close the gap and maybe overtake its American counterpart. BYD trailed Tesla by little over 3,000 units during the same period. This narrow margin means that BYD is about to beat its American counterpart in BEV sales, a remarkable feat given Tesla CEO Elon Musk’s past view of BYD as a joke.
BYD’s cheaper EVs have dethroned Volkswagen (ETR:VOWG_p) (OTC:VWAGY) as China’s top car brand.
TSLA rose 6.4% to $260.53 this week from Monday’s open. Locally traded BYD shares fell 0.5% to 236.70 {0|Chinese yuan}}.
Polestar sees strong 3Q growth.
Swedish electric car maker Polestar Automotive (NASDAQ:PSNY) saw a 50% year-over-year increase in Q3 vehicle deliveries, led by strong sales of the improved Polestar 2.
The company shipped 13,900 units, increasing profit margins. Polestar delivered 41,700 vehicles in the first nine months, up 37% year-over-year. The Polestar 4 will begin deliveries in China in Q4, and the business expects to deliver 60,000 to 70,000 vehicles in 2023.
CEO Thomas Ingenlath hailed the quarter “strong” and predicted greater profitability for 2023. said, “We will soon have a compelling range of three distinctive cars, including two luxury SUVs, each addressing an exclusive luxury EV segment.”
Polestar will announce its third-quarter financials after the market ends on November 8, 2023.
After hitting $2.86 on Tuesday, PSNY shares retreated but closed the week up 2.3% from Monday.
VinFast- Still falling
After VinFast (NASDAQ:VFS) announced insider sales, its shares fell 30%.
VinFast’s market valuation fell by almost $140 billion in a month, with the stock plummeting below its $22 launch offering price seven weeks ago.
The majority of VinFast shares, 99%, are owned by Vingroup’s chairman and founder, Pham Nhat Vuong, leaving a minor portion for external investors. This limited share supply increases stock volatility.
Despite these issues, VinFast declared a half-billion-dollar quarterly loss and delivered over 9,000 electric vehicles worldwide, producing $315 million in sales. The business is building an EV factory in North Carolina to produce up to 150,000 vehicles per year.
From Monday’s open, VFS shares fell 27% to $8.03 on Friday.
Energy & precious metal Settlement and outlook
Oil Market Settlements and Activity
WTI crude for November delivery settling at $82.79, up 48 cents, or 0.6%, closed at $82.81.
That was a bounce from the 8% drop of the last two days, but the US crude benchmark hit a five-week low of $81.53.
After falling 8% between Wednesday and Thursday, London-traded Brent for the most active December contract settled at $84.57, up 54 cents, or 0.6%.
The global crude benchmark fell to $83.50, matching WTI’s five-week low.
US and UK crude lost 9% and 11%, respectively, for the week. Both had their worst week since March.
Technical Outlook: WTI Oil
following last week’s uncertainty following resistance around $95, WTI reacted to headwinds that took it past the 100-week SMA of $86.15 and $81.50, near the 50-week EMA of $80.90.
Dixit suggested a break below this zone could cause limited consolidation to weekly middle Bollinger Band $79.30. The support zone could see robust demand again as value buyers anticipate a new move higher beyond the recent high of $95.”
Gold Market Settlements and Activity
Gold futures on New York’s Comex and worldwide bullion spot prices were up on the day, but they declined for a third week in a row due to the bond selloff and dollar gain.
The most active gold futures contract on New York’s Comex, December, settled Friday at $1845.20, up $13.40, or 0.7%. It dropped to $1,823.55 seven months earlier.
The spot price of gold, which traders watch more than futures, closed at $1,832.59, up $12.33, or 0.7%. Gold touched a 7-month low of $1,810.47 today.
Gold Spot Price Outlook
Gold fell to $1,810, below the 200-week SMA of $1,815 and spurred retail short covering after a weekend of uncertainty, according to Dixit. After rebounding, $1,835 closed at 5 Day EMA of $1,832.
“RSI and Stochastics turn north, indicating a strong rebound that targets 4 Hour 50 EMA $1,846 and 100 Week SMA $1,855. Above this zone, the positive rebound should aim $1,863-$1,869 and $1,881. A fall to $1928-$1820 could be a buying opportunity.”
“Israel-Palestine tensions create a geopolitical crisis that will spur panic buying in gold. The rally may quickly reach $1927.”
Natural Gas Market Settlements and Activity
The natural gas bull is finally starting to succeed after months of failure.
America’s favorite fuel for interior heating and cooling held steady at $3 on Friday as Henry Hub futures on the New York Mercantile Exchange rose double-digits for a second week.
Gas prices turned around after being locked at mid-$2 for most of the year as weather, demand, and production coordinated to support higher prices.
Gas storage data showed a minor rise last week, contrary to forecasts, as air-conditioning demand increased due to lingering warmth before cooler fall weather.
The most active November gas contract on the New York Mercantile Exchange’s Henry Hub closed Friday at $3.33 per mmBtu, up 17 cents, or 5.4%. November gas rose 14%, extending its 11% gain from the previous week.
Gas prices rose this week after the Energy Information Administration (EIA) reported a build of 86 billion cubic feet (bcf) in fuel storage during the week ended Sept. 29, compared to Investing.com experts’ 92 bcf estimate. The week before Sept. 22, storage rose 90 bcf.
The EIA reported 3.445 trillion cubic feet of US gas storage last week, up 11.6% from a year earlier. additional than 20% additional storage was added this year. Inventory rose 5.3% over five years (2018-2022), down from double-digits earlier this year.
Outlook for natural gas prices
Dixit’s outlook: “After 33 weeks of consolidation, 16 of which above the weekly Middle Bollinger Band, natural gas futures broke above the 50-week EMA of $3.35. As long as $2.82 maintains as support, the uptrend seeks the 200-week SMA at $3.77, then $4, the psychological handle.
Weekly Earnings Calendar
Tuesday, Oct 10
- PepsiCo. (PEP)
- Neogen Corp. (NEOG)
Wednesday, Oct 11
- Infosys Ltd. (INFY)
- Fastenal Co. (FAST)
- Delta Air Lines (DAL)
- Walgreens Boots Alliance (WBA)
- Domino’s Pizza (DPZ)
- Commercial Metals Co. (CMC)
Thursday, Oct 12
- UnitedHealth Group (UNH)
- JPMorgan Chase (JPM)
- BlackRock (BLK)
- Progressive Corp. (PROG)
- Citigroup (C)
- Wells Fargo (WFC)
- PNC Financial Services (PNC)
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