Next week, the Department of Transportation is expected to impose a new requirement on Tesla (TSLA) to expand its charging network in the US and include the chargers used by its competitors, according to administration officials cited by Reuters. If Tesla fails to comply with the requirements, it could be left out of the $7.5 billion in subsidies offered by the government as part of President Joe Biden’s plan to install 500,000 EV chargers in the country. This is seen as essential to the president’s goal of having 50% of new vehicles in the US be electric by 2030. Tesla CEO Elon Musk has previously talked about the possibility of opening the Supercharging network to competitors but has not yet done so in the US. During a meeting with White House officials last month, the subject of the EV charging program was reportedly discussed, but there has been no public comment from Musk on any potential changes in the US market.
Market News for Last Week (06.02.23 – 10.02.23):
- AI stocks rally in latest Wall Street craze sparked by ChatGPT:
Shares of C3.ai Inc, BigBear.ai and SoundHound AI extended a rally on Monday (6th of February) as artificial intelligence becomes a new buzzword on Wall Street with the viral success of ChatGPT chatbot, attracting interest from retail punters.
Software firm C3.ai (AI) rose 11%, analytics firm BigBear.ai (BBAI) jumped nearly 21% and conversation artificial intelligence company SoundHound (SOUN) surged 40%.
Tickers for the three small-cap companies were among those that were being bandied about on the investor-focused social media platform, stocktwits.com.
- On Friday, 10th of February, shares of Adidas (ADDYY) dropped as much as 12.6% following the company’s warning that it may incur a loss for the first time in 30 years, due to its separation from Kanye West and his Yeezy brand. The company stated that it may have to write off the entire inventory of the Yeezy brand, which could result in a loss of 700 million euros ($749 million) this year. Additionally, not selling the stock would result in a 1.2 billion euro decrease in revenues and a 500 million euro decrease in operating profit in 2023, bringing it close to break-even.
Adidas CEO Bjorn Gulden, who recently joined the company from rival Puma, acknowledged the poor performance and declared that the company would undergo a “year of transition” to return to profitability. At the time of reporting, Adidas shares were down 12.3% at 137 euros.
This marks the fourth profit warning in less than six months for the company, which predicts a high single-digit percentage decline in sales this year, compared to the 4% increase in revenue expected by analysts. In October, the company had already lowered its 2022 forecasts due to weaker demand in China and Western markets, as well as one-off expenses related to exiting Russia. Thursday’s results showed that the company had performed worse than expected, with an operating margin of only 3%. Full results for 2022 will be reported on March 8th.
- The European Union Retail Sales was published on February 6th and measured the month-to-month change in retail sales in the EU. It is a significant indicator of consumer spending and the overall health of the economy and results in significant volatility in the euro and European stocks. A decline was expected, indicating a slowdown in the economy and lower consumer spending. Generally, if the actual beats the forecast, then that’s good for the currency and you should see positive change to the affected symbols.
Forecast: -2.4$ | Result: -2.7%
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