On the 24th local time, dragged down by technology stocks, the three major US stock indexes collectively fell sharply, with the Nasdaq and S&P 500 indexes both experiencing their largest declines since 2022.
As of the close, the Dow Jones Industrial Average fell 1.25%, the Nasdaq fell 3.64%, and the S&P 500 index fell 2.31%. The seven tech giants in the US stock market collectively fell sharply, with Nvidia falling 6.80% and Tesla falling 12.33%, resulting in a total daily market value evaporation of over $750 billion (approximately RMB 545 trillion).
With the stock market plummeting, the Chicago Board Options Exchange Volatility Index (VIX) (Wall Street's panic index) rose to 18.46, the highest level since the end of April. According to Trade Alert data, the turnover speed of VIX options on Tuesday was almost twice as fast as usual.
In addition, Ford Motor's EPS (earnings per share) fell short of expectations, and it is still expected that Ford Pro's EBIT will lose at least $5 billion for the full year, with the stock price falling more than 10% after hours; IBM's revenue exceeded expectations, claiming that generative AI brought in over $2 billion in orders, and its stock price rose more than 4% after hours. The company stated in a statement on Wednesday that orders for artificial intelligence consulting and software have exceeded $2 billion since mid-2023. This is twice the amount disclosed by IBM in its last financial report in April. IBM CEO Arvind Krishna said in an interview that about three-quarters of AI orders come from consulting, while the rest come from software.
The three major stock indices in the United States have experienced a sharp decline
On Wednesday Eastern Time, the US stock market opened lower and fell, with the three major indexes collectively closing lower. The Nasdaq fell 3.64%, the largest daily decline since October 2022, and the lowest closing point since mid June; The S&P 500 index fell 2.32%, marking the largest daily decline since December 2022; The Dow Jones Industrial Average fell 1.25%.
The "Big Seven" collectively fell sharply, with Apple falling 2.88%, Microsoft falling 3.59%, Amazon falling 2.99%, Nvidia falling 6.80%, Tesla falling 12.33%, Meta falling 5.61%, and Google falling 5.04%; The total daily market value evaporated by over 750 billion US dollars.
Bank stocks generally fell, with JPMorgan Chase down 0.77%, Goldman Sachs down 1.15%, Citigroup down 1.55%, Morgan Stanley down 1.47%, Bank of America down 0.53%, and Wells Fargo down 0.35%.
Airline stocks fell across the board, with Boeing down 3.46%, American Airlines down 2.96%, Delta Air Lines down 1.54%, Southwest Airlines down 2.06%, and United Airlines down 4.56%.
Chip stocks collectively fell sharply, with Broadcom falling 7.59%, ASML falling 6.44%, Qualcomm falling 6.35%, AMD falling 6.08%, TSMC falling 5.94%, Intel falling 3.79%, and Microchip Technology falling 3.5%.
Popular Chinese concept stocks generally fell, with the Nasdaq China Golden Dragon Index falling 1.93%. Ideal Auto, Xiaopeng Motors, and NIO fell more than 4%, Tencent Music, Futu Holdings, and iQiyi fell more than 3%, Bilibili and Manbang fell more than 2%, Baidu, JD.com, and Vipshop fell more than 1%, and Pinduoduo, Weibo, and Alibaba fell slightly. NetEase rose by over 1%.
Major European stock indices also fell across the board, with the German DAX index falling 0.92% to 18387.46 points, the French CAC40 index falling 1.12% to 7513.73 points, and the UK FTSE 100 index falling 0.17% to 8153.69 points.
International oil prices rebounded, and WTI September crude oil futures closed up 0.63 US dollars, an increase of about 0.82%, at 77.59 US dollars per barrel; Brent crude oil futures for September closed up $0.70, or about 0.86%, at $81.71 per barrel.
Tesla plummets 12.33%
As of the close of the US stock market, Tesla fell 12.33%.
On the early morning of July 24th, Tesla disclosed its second quarter financial report. Tesla achieved a total revenue of $25.5 billion in the second quarter of 2024, a year-on-year increase of 2%, exceeding analysts' expectations.
However, the company's net profit (calculated according to US GAAP) decreased by 45% to $1.478 billion; Earnings per share also decreased by 46% year-on-year, to $0.42; The total gross profit margin was 18%, a decrease of 0.2 percentage points year-on-year, but an increase of 0.6 percentage points month on month.
Tesla attributes its revenue growth to the growth of its energy production and storage business, increased delivery of Cybertrucks, and a decrease in the average selling price of Model S, 3, X, and Y vehicles. Among them, the deployment of energy storage systems Megapack and Powerwall reached a new high in the second quarter, with a total storage deployment of 9.4 GWh.
Tesla produced 410831 vehicles in the second quarter, a year-on-year decrease of 14%, and delivered 443956 vehicles, a year-on-year decrease of 5%. It is worth noting that the production and delivery of Model 3 and Y have decreased by 16% and 5% respectively year-on-year.
The delivery in the second quarter fell short of expectations, putting pressure on Tesla's performance. Tesla expects continuous production growth in the third quarter in its financial report.
Overall, in the first half of this year, Tesla delivered a total of 830766 electric vehicles, which is less than half of last year's 1.81 million vehicles.
Some analysts believe that Tesla's delivery volume has declined year-on-year for two consecutive quarters this year, and based on the current delivery situation, it is difficult to reach last year's delivery level. Meanwhile, Tesla's market share in the US electric vehicle market has fallen below 50% for the first time, and it is also facing the same situation in Europe and China, indicating that its market share is rapidly being eroded by competitors.
Tesla CEO Musk officially announced during the earnings call that Robotaxi will be delayed until October 10th and may be put into use by the end of this year or at the latest next year.
On April 6th of this year, Musk announced that Tesla plans to launch Robotaxi on August 8th. Recently, there were market reports that Tesla will delay the release of Robotaxi. On July 16th, Musk stated on social media that he has requested significant design changes to the front of Robotaxi, and the additional time gained from the delayed release date will give the company the opportunity to showcase some other content.
In addition, Musk revealed during a conference call that Tesla will apply for regulatory approval in Europe and China to implement supervised FSD, and is expected to receive approval before the end of this year. It is reported that in June 2024, the Lingang New Area in Shanghai began to promote the pilot landing of Tesla FSD, and 10 Tesla vehicles will undergo road tests in Shanghai.
In terms of humanoid robots, Musk stated that the second-generation humanoid robot Optimus is already handling battery related tasks in factories, and it is expected that thousands of Optimus will perform tasks at Tesla factories by the end of 2025, with deliveries to external customers starting in 2026. Musk boldly predicted at the 2024 shareholders' meeting that the ratio of humanoid robots to humans in the future will exceed 1:1, and even reach an astonishing 2:1 ratio.
In addition, Tesla will deliver affordable Volkswagen models in the first half of next year, which can use existing production lines, maximizing the utilization of its existing capacity of nearly 3 million vehicles.
Ford Motor's Q2 earnings fell short of expectations, causing its stock price to drop 11% after trading
Due to the warranty cost issue that has plagued the automaker for many years, Ford's Q2 earnings did not meet Wall Street's expectations, but its revenue exceeded expectations.
CNBC
This car manufacturer has raised its full year free cash flow target but maintained its 2024 earnings expectations, which has disappointed some investors who were hoping to raise their expectations. Ford's expectations for this year include adjusted EBIT between $10 billion and $12 billion.
After the market closed, the stock price of the car manufacturer fell by about 11%. The closing price of the stock on Wednesday was $13.67 per share.
The following is a comparison of analyst estimates between the company and the London Stock Exchange Group (LSEG) survey:
Earnings per share: adjusted to 47 cents, expected to be 68 cents
Automotive business revenue: 44.81 billion US dollars, expected to be 44.02 billion US dollars
This Detroit automaker stated that its profitability has been affected by an increase in warranty reserves to cover vehicle issues. These costs are related to the 2021 model year or earlier models, "Ford CFO John Lawler said at a media briefing.
Ford stated that recent measures to improve quality and vehicle releases are yielding results and are expected to help reduce future warranty costs.
We have made substantial progress in improving quality, reducing costs, and lowering the complexity of the entire enterprise, "Lawler said at a media briefing." We have made substantial progress in quality, which will benefit us in the future
Lawler refused to disclose Ford's total warranty cost for the second quarter, but stated that it increased by $800 million compared to the previous quarter.
The net profit for the second quarter was $1.83 billion, or 46 cents per share, compared to $1.92 billion, or 47 cents per share, in the same period last year. Compared to the second quarter of 2023 at $3.79 billion (or 72 cents per share), the adjusted EBIT decreased by 27% year-on-year to $2.76 billion (or 47 cents per share).
Ford's overall revenue, including its financial business, increased by approximately 6% year-on-year in the second quarter, reaching $47.81 billion.
Ford CEO Jim Farley told investors on Wednesday that his Ford+restructuring plan is still underway to give the automaker more profits.
We are definitely different from the company three years ago, "Farley said on the company's earnings conference call, noting that" Ford's restructuring is not without growth troubles
Ford's traditional business operations (known as Ford Blue) earned $1.17 billion in the second quarter, while its Ford Professional Business operations earned $2.56 billion. Its "Model e" electric vehicle division incurred a loss of $1.14 billion between April and June.
The Ford+program initially focused on electric vehicles when it was announced on the company's first investor day in May 2021. The plan was proposed by Farley, who took over as the head of the automaker in October 2020, and has since shifted towards focusing more on customer choices and next-generation electric vehicles to drive profit growth.
Farley stated that Ford's "more realistic and clear" electric vehicle plan, including a focus on small next-generation electric vehicle platforms, will bring value to the company in the coming years.
As of Wednesday's close, Ford's stock price has risen more than 10% so far this year due to the automotive industry's more flexible pricing than expected, but some Wall Street analysts believe that the automaker's profits may have peaked.
We don't think there will be too much difference or decline in the second half of the year compared to the first half, "Lawler said." There will be a profit or loss in any half of the year, which is part of our expectation, and we plan to manage it
After its local competitor General Motors raised its annual forecast for the second time on Tuesday, Ford is facing pressure to raise its expectations.
General Motors' second quarter performance also exceeded Wall Street's top and bottom line expectations, but the automaker's stock price fell 6.4% on Tuesday.
