Broadly, the technology sector has been witnessing the negative impacts lately leading to the negative momentum in the NASDAQ Composite. Not so long ago, these stocks were also used for capping the losses which were witnessed by the investors as a result of the global sell-off in the equities.
Tesla Shares Skyrocketed Dashing Negative Views and Criticism
It seems like now everything is going well with Tesla (NASDAQ: TSLA) and with the billionaire Elon Musk. However, the journey to this level has not been easy for the company as well as for billionaire. Mr. Musk has received a lot of criticism in the past from the market players and from Securities and Exchange Commission or SEC in regard to its comments regarding taking Tesla private. The billionaire, on a social networking site, has also announced that the funding for the process has also been secured. However, later on, it was found that Mr. Musk has been misleading the investors. Another criticism which has been faced by him was about its personal habits of smoking and the media was entirely focused on this issue. Thus, not so much attention was given to the industry in which Tesla operates.
Recently, the short sellers, as well as critics, were of the view that Tesla has managed to outpace the competition. The optimism in the minds of market players was seen mainly because of the robust demand was seen in regard to the Model 3 sedan. The strong momentum which was witnessed in the shares of Tesla on October 25, 2018 was primarily underpinned by the strong quarterly results. Tesla shares settled at US$314.86 per share implying an increase of US$26.36 per share or 9.14%. The company’s position has been strengthened and thus, it might not be requiring additional outside capital. The Wall Street analysts have been continuously stating that the Tesla might go for fund raising in order to support the production of Model 3 sedan. The analysts are expecting that a positive trend in the company’s profitability would help it in generating sufficient cash to meet the debt obligations amounting to $1.7 billion.
Disappointing Performance by Alphabet Raises Worries
Google’s parent Alphabet (NASDAQ: GOOGL) has witnessed a subdued momentum with respect to the third-quarter growth in the revenues as compared to the analysts’ expectations. The company’s results for third-quarter got a hit by the increased expenses which, as a result, impacted its operating margin. The disappointing results increased the concerns of the investors that robust deployments in the new businesses, emerging competition as well as heightened regulatory challenges have been impacting the expected returns. However, the analysts are expecting that the company’s earnings momentum is overall robust. They stated that the company’s third-quarter results got impacted mainly because of the increased cost pressures.
Amazon Witnessed Substantial Fall in After-Hours Trading
The race between Microsoft (NASDAQ: MSFT) and Amazon (NASDAQ: AMZN) continues. The shares of Amazon witnessed a huge fall of 7.42% in the after-hours trading on October 25, 2018. This was witnessed because of the disappointing forecasts for the sales with respect to the next quarter. The company had announced a conservative forecast with respect to its sales. The company had given the forecasts for the sales in the range of $66.5 billion-$72.5 billion while the analysts were anticipating sales in the next quarter of $73.8 billion.
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkinemedia.com and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.