PPI, another important indicator of inflation in the United States, continued to explode in December, and the year-on-year growth rate followed a record high! But the growth rate was slightly lower than market expectations. One of the Fed's most dovish officials, Vice Chairman Nominee Brainard, has changed his attitude, saying the Fed will use "strong" tools to drive down inflation and hinting at a rate hike as soon as March.
The three major stock indexes opened high and went low, all of which hit the largest closing decline in more than a week, large technology stocks led the decline, and Chinese stocks also languished. U.S. Treasury yields plummeted, and the dollar index hit a two-month low!
There are "bones" that Tesla can't chew on? Musk said that entering the Indian market is still challenging, and Tesla's market value evaporated by $70 billion (about 450 billion yuan) overnight.
TSMC's fourth-quarter earnings and revenue hit new highs and plans to expand production this year, with a market capitalization skyrocketing by $38 billion (nearly 250 billion yuan).
In 2021, the most bullish auto stock, Ford Motor, broke out again, and its market value exceeded 100 billion US dollars for the first time!
There are "bones" that Tesla can't chew on?
Musk said that entering the Indian market still faces challenges
On Thursday, EST, a user asked Tesla CEO Musk on Twitter about the latest progress of the brand's entry into the Indian market, and Musk replied to the user: "There are still many challenges to be dealt with on issues related to the government."
(Screenshot of Musk's Tweet)
Musk has said he hopes to sell Tesla electric cars in India as early as 2019, but after three years, the plan still appears to be at a standstill.
Musk and Prime Minister Narendra Modi's government have been negotiating for years, but numerous disagreements over India's local factories and the country's up to 100 percent import tariffs have led to a stalemate in the talks.
It is understood that the Indian government has asked the electric vehicle manufacturer to increase its localization procurement efforts in India and share a detailed production plan. Musk has asked for lower taxes so Tesla can sell imported cars at lower prices in a tight-budget market.
Last October, an Indian minister said he had asked Tesla to avoid selling Chinese-made cars in India, and some Indian officials wanted the company to produce electric cars in India first, promising incentives. At present, India's high-end electric vehicle market is still in its infancy, and the country's charging infrastructure is lacking. Of the 2.4 million vehicles sold in India last year, only 5,000 were electric, and only a few of them were luxury electric vehicles.
For Tesla, india with a large population is a very promising market, but the country's car market is still dominated by Suzuki Motors and Hyundai Motors, which are cheap and practical in the local area and are loved by local consumers.
Musk has also said that Tesla is likely to build a factory in India, but the premise is that Tesla can succeed in the Indian market. In July last year, Tesla sent a letter to India's Ministry of Transport and Industry in an attempt to reduce tariffs on electric vehicle imports from the current 60%-100% to 40%, but without success.
Last January, Tesla registered its subsidiary, Tesla India Automotive Energy Ltd. in Bangalore, the capital of Karnataka. In February, according to the Indian Newspaper Trust, Tesla's first Indian factory will be located in Karnataka, although Tesla has since "recruited" to enter India, but at present, the plan to build a factory is still in the game.
In December last year, Tesla's seven "models" were approved for sale in India. According to people familiar with the matter, Tesla India's subsidiary Tesla India Automobile and Energy Company has obtained approval certificates for another 3 models, and a total of 7 models have been approved so far. However, the exact timing of Tesla's listing in India remains unknown.
In addition, Tesla will also face competitive pressure from other traditional automakers, including German car giant Mercedes-Benz, which announced on Wednesday that it will launch a locally assembled Mercedes-Benz EQS in India in the fourth quarter, which is an electric version of the flagship S-Class sedan.
Tesla's recent troubles are not only in India, but also in the solar energy program. California plans to introduce new regulations that customers who install solar panels on their roofs or plan to install solar panels in the future will have to pay $8 per kilowatt per kilowatt per month to the grid. If other charges are added, solar roof systems must pay $50 to $80 per month to the grid. Musk and his followers fear that such a proposal would hinder interest in environmentally friendly clean energy alternatives with long-term environmental impacts.
Yesterday, Musk tweeted that this was "a weird anti-environmental action by the California government" and shared a link to an event launched by Tesla's Silicon Valley Club for Tesla's electric car and solar panel fan base.
Tesla closed down 6.75 percent to close at $1,031.56, wiping out $70 billion in market value to a total of $1.04 trillion today. Tesla has fallen more than 14% so far in the year.
The three major stock indexes opened high and went low
Both recorded the largest closing decline in more than a week
Affected by the new high of PPI data and the hint of interest rate hikes by the Federal Reserve Brainard, as well as the obvious decline in technology stocks led by Tesla, the three major stock indexes turned down intraday after opening high, and finally closed down collectively, all of which hit the biggest closing decline since Wednesday on January 5.
The Dow closed down 176.7 points, or 0.49 percent, at 36,113.62 points; the Nasdaq closed down 2.51 percent at 14,806.81 points, a new low since Oct. 13 last year and closed down for the first time in the last four days; the S&P 500 closed down 1.42 percent at 4,659.03 points, a new low since December 21 last year, and both ended a two-day run with the Dow.
U.S. Treasury yields fell sharply
The dollar index hit a two-month low
The 10-year Treasury yield fell to a one-week low in U.S. stocks; the dollar index widened, and during the Brainard hearing, it once again refreshed its new low since November last year, further out of the 95 mark.
Leading technology stocks have fallen sharply
Drag down the NASDAQ 100 index
The technology-dominated Nasdaq-100 fell more than 400 points, or 2.57 percent. Large leading stocks and chip stocks fell.
Tesla rival Lucid closed down more than 8.8 percent, cloud information security company Zscaler fell nearly 8.6 percent, Peloton and Tesla fell at least more than 6.7 percent, and JD.com fell more than 6 percent.
Among the leading technology stocks, Microsoft closed down more than 4.2%, and its market value fell by more than $90 billion (about 600 billion yuan). Netflix fell more than 3.3 percent, Amazon fell more than 2.4 percent, Google parent company Alphabet and Facebook's Meta fell about 2 percent, and Apple fell 1.9 percent.
Chinese stocks performed weakly
Mostly down
Chinese stocks ended their rally and withered.
Bilibili and Good Future both closed down more than 10%, New Oriental fell nearly 8%, Shell fell 7.42%, Wuxin Technology fell 6.68%, JD.com fell about 6.5%, Alibaba, Tencent ADR, Baidu fell more than 4%, Pinduoduo, Weilai Automobile fell more than 3%, Xiaopeng Automobile, Andyour Worry-free fell more than 1%.
TSMC's revenue reached a new high
Market capitalization soared by 250 billion
While most Chinese stocks are sluggish, TSMC has ushered in a highlight moment.
TSMC yesterday announced its fourth quarter ending December 31, 2021. According to the financial report, TSMC's fourth-quarter consolidated revenue was NT$438.189 billion (approximately US$15.855 billion), an increase of 21.2% year-on-year, the sixth consecutive quarter; net profit was NT$166.232 billion (approximately US$6.015 billion), an increase of 16.4% year-on-year; and diluted earnings per share were NT$6.41 (US$1.15 per ADR).
TSMC's gross profit margin in the fourth quarter was 52.7%, the operating profit margin was 41.7%, and the net profit margin was 37.9%.
Driven by the record earnings and revenue in the fourth quarter, TSMC bucked the market by 5.26% to close at $139.19, with a total market value of 7218.5, soaring by $38 billion (nearly 250 billion yuan).
In 2021, the most bullish auto stock, Ford Motor, broke out again
The market value exceeded 100 billion US dollars for the first time!
In 2021, the stock price of veteran auto giant Ford soared by 137.48%, beating Tesla, General Motors, Rivian and other car companies to win the top spot in the 2021 automakers' stock price performance list.
Since the new CEO took office in late 2020 and undertook drastic reforms, the company's stock price has risen by more than 220 percent, or three times more than the stock price that was less than $7 at the time. On November 8 last year, Ford's stock price broke through $20 for the first time in 20 years.
Ford Motor, which rose sharply last night, continued to rally intraday, breaking the $100 billion mark for the first time in the company's market capitalization history, further refreshing its 20-year high since mid-2001.
Ford closed at $25.02, up 2.25 percent, for a total market capitalization of $99.871 billion.
The PPI of the inflation indicator continues to reach new highs
The Fed's "second-in-command" candidate hinted at a rate hike as soon as March
U.S. stock markets released December PPI data on Thursday, showing the 20th consecutive month of gains, but the increase was lower than expected as energy prices such as gasoline fell, indicating a slowdown in price gains.
Data released by the U.S. Department of Labor showed that U.S. PPI rose 9.7 percent year-over-year in December, the highest increase since 2010, up 9.6 percent from the previous value, but less than the market expected 9.8 percent. It rose 0.2% month-on-month to a new low since November 2020 and was 0.8% previously.
But excluding volatile food and energy, the U.S. core PPI grew 8.3 percent year-over-year in December, well above market expectations of 8 percent and 7.7 percent previously.
On the same day, Brainard, the Fed's "second-in-command" candidate, who is regarded by the outside world as one of the Fed's most dovish officials, attended the Senate nomination hearing. At the meeting, she changed her dovish attitude, repeatedly mentioning that "inflation in the United States is too high" and saying that reducing inflation in interest rate policy is the "top priority" of the Fed at this stage.
It is worth noting that she is also open to interest rate hikes in March this year, and said that "once the amount of wide net bond purchases is over, interest rates can be raised", and also supports the reduction of the balance sheet "after a period of time" after starting to raise interest rates, and it is expected that in the future, the Fed will only use QE to buy bonds when the interest rate cut space no longer exists.
According to Wall Street news, according to the original plan, the Fed will complete the reduction of bond purchases in mid-March this year, and Brainard's remarks suggest that interest rates will be raised as soon as March.
That's in contrast to what she said last year that the risk of inflation is not higher in the future, but a return to years of "too low compared to the Fed's 2 percent target" model and strong advocacy of not shrinking monetary stimulus too early.
The analysis points out that Brainard's intention to firmly resist price increases marks an important shift in the position of one of the most influential dovish members of the Fed. Now it seems that even the most dovish members agree that if inflation is really to be curbed, interest rates should be raised long ago.
In addition, Philadelphia Fed President Harker also said that if the US inflation rate continues to soar, he will support more than three interest rate hikes this year. "I currently think there will be three rate hikes this year and I'm very open to raising rates starting in March this year," Haq said. I would be willing to accept more hikes if needed. ”
In addition, previous Kansas Fed President George, St. Louis Fed President Bullard, Cleveland Fed President Mastre and Atlanta Fed President Bostic also expressed support for the March rate hike.
Yesterday, the U.S. Bureau of Labor Statistics released last December's consumer price index (CPI) rose 7% year-on-year for the first time since 1982. In response, Harker said that this indicator is very bad.