Why Shares of Tesla Are Sinking Today
Shares of Tesla (NASDAQ: TSLA) traded 4% lower as of 1:56 p.m. ET, along with the broader market and as the electric vehicle maker had to recall hundreds of thousands of vehicles. The Dow Jones Industrial Average had tanked nearly 700 points, while the Nasdaq Composite had fallen over 1.6%.Markets sold off intensely again today due to concerns about the consumer. Earlier this week, Walmart, a proxy for the consumer, issued weaker-than-expected guidance.The release of the University of Michigan's consumer sentiment index this morning only exacerbated these concerns. In January, the index dropped 10% to 64.7, a bigger decline than expected. Consumers' five-year expectations for inflation came in at 3.5%, the highest level seen since 1995. The market has recently looked past a higher-for-longer rate environment, driven by sticky inflation, but weakness in the economy has proven to be a touchy subject. After all, consumer spending makes up more than two-thirds of gross domestic product.Continue reading
Shares of Tesla (NASDAQ: TSLA) traded 4% lower as of 1:56 p.m. ET, along with the broader market and as the electric vehicle maker had to recall hundreds of thousands of vehicles. The Dow Jones Industrial Average had tanked nearly 700 points, while the Nasdaq Composite had fallen over 1.6%.
Markets sold off intensely again today due to concerns about the consumer. Earlier this week, Walmart, a proxy for the consumer, issued weaker-than-expected guidance.
The release of the University of Michigan's consumer sentiment index this morning only exacerbated these concerns. In January, the index dropped 10% to 64.7, a bigger decline than expected. Consumers' five-year expectations for inflation came in at 3.5%, the highest level seen since 1995. The market has recently looked past a higher-for-longer rate environment, driven by sticky inflation, but weakness in the economy has proven to be a touchy subject. After all, consumer spending makes up more than two-thirds of gross domestic product.
