Tesla's latest earnings just came out, and it beat Wall Street estimates, with earnings per share of $0.72 and improved gross margins of 19.8%. The stock finished 10% higher after-hour since CEO Elon Musk predicted 20-30% vehicle sales growth next year and reported record-low production costs of $35,100 per vehicle. Vehicle deliveries grew 6% to 462,890 units, while revenue rose 7% to $25.2 billion and profit increased 17% to $2.2 billion. The company plans to launch cheaper models in early 2025, maintaining its position as the only profitable pure EV maker. Beside scepticism over its Robotaxi announcement, Tesla confirmed the Cybertruck is now profitable and its core car business remains strong. Analysts view the results positively, noting Tesla's success in balancing its traditional auto business with future tech investments in autonomous driving and AI.
EQUITY
Wallstreet Street was painted red mainly due to fear of rising yield as magnificent seven loses 2.25%. Notable company movements included Enphase Energy dropping 15% after missing earnings expectations, McDonald's falling 5.1% amid an E. coli outbreak investigation, and AT&T rising 4.6% even with revenue challenges. The focus now shifts to durable goods on Friday in order to gauge the health of long-term appliances's sales.
GOLD
Gold rebounded to above $2,730 per ounce on Thursday after falling over 1% from its record high of $2,750 and closing below previous day lows. The earlier pullback was attributed to a stronger US dollar and rising Treasury yields, with the 10-year yield hitting a three-month high of 4.25%. The precious metal continues to find support from safe-haven demand instigated by Middle East tensions, the US presidential election, and easing monetary policies, although technical indicators suggest further pullback.
OIL
Oil prices rose over 1% after Israel conducted strikes on Damascus and exchanged fire with Hezbollah. While U.S. crude inventories increased by 5.5 million barrels last week, strong travel demand in Asia and consistent drawdowns in distillate stocks in several major markets provided support for oil demand. Although OPEC has about 5 million barrels per day of spare production capacity to offset potential supply disruptions, analysts warn that oil prices could spike to triple digits if the conflict escalates to include attacks on oil infrastructure or restrictions in the Strait of Hormuz.
CURRENCY
The U.S. dollar traded near a three-month high owing to rising Treasury yields. Market sentiment was influenced by gapping bets on Donald Trump's election victory, which could lead to inflationary policies. The Japanese yen faced pressure but found some support after Japanese officials warned about potential intervention, while the euro hit a four-month low as the European Central Bank signalled faster rate cuts.
