Marketbites: Tesla Downgraded
Portfolio Manager Commentary:
The Nasdaq Composite slumped about 1% on Monday as investors sold shares of technology companies that have outperformed this year and final trading week of June commenced. A pullback in technology giants contributed heavily to the Nasdaq’s sharp midday decline. Nvidia, Alphabet, and Meta Platforms traded lower, while Tesla lost about 5% as Goldman Sachs downgraded the electric car maker, citing pricing headwinds.
Technology stocks have rebounded this year after a difficult 2022 as investors bet on the promise of artificial intelligence and hope for an end to the Federal Reserve’s hiking campaign. Rotation back into popular growth names has lifted the tech-heavy Nasdaq index 27.6%, putting it on pace for its best first half since 1983.
The final week of June is a light one for economics reports and corporate earnings, which are highlighted by Walgreens Boots Alliance on Tuesday and Nike on Thursday. Traders are also keeping an eye on Europe, after Russia saw a brief rebellion by a private military group over the weekend. Uncertainty about the situation there could keep the markets on edge.
Chart of the Day:
Sinking global trade is pummeling Asian exports, bringing some relief on inflation to U.S. and other Western consumers. Cheap Asian goods helped keep a lid on price growth for decades before the pandemic. Economists say that phenomenon is unlikely to return with the same intensity now that the high-water mark of globalization has passed.
What else is happening:
Putin tries to reassert control - read here
China's 'Tesla Killer' stumbles amid EV price war - read here
Gucci owner is buying perfume maker Creed to grow its luxury empire - read here