The main indices on Wall Street are set to open mostly lower on Monday morning as traders await results from electric car maker Tesla Inc (NASDAQ:TSLA).
The Dow Jones Industrial Average, having only 30 shares, is more susceptible to a couple of rogue gainers and is expected to open 35 points higher at 34,078 but the broader-based S&P 500 is tipped to fall 4 points to 4,176 while the tech-heavy Nasdaq 100 is seen sliding 49 points to 13,892 at the start of what is a big week for tech company results.
Tesla, Google’s parent company Alphabet Inc (NASDAQ:GOOG) and Apple Inc (NASDAQ:AAPL) are all set to update the market this week with Tesla getting the ball rolling this afternoon after the market shuts.
“Tesla’s stock price is little changed since the start of 2021, but that stat is misleading. Worth about $736 at the time of writing, the shares have traded as high as $900 and below $600 over the past few months, demonstrating a level of volatility that investors have grown accustomed to,2 saidLee Wild, the head of equity strategy at interactive investor.
“There are multiple drivers of the share price, not least growing optimism around the electric vehicle revolution, particularly in China, but also globally as governments accelerate the shift away from fossil fuels. US president Joe Biden’s green agenda should provide a significant boost to Tesla.
“We already know Tesla achieved record production in Q1, and further interest in the Model Y in China should mean a massive increase in sales in 2021. Assuming no more major pandemic disruption, expectations are for Tesla to far exceed 800,000 deliveries this year, up from around 500,000 in 2020. Tesla could confirm expectations of at least 50% growth in annual deliveries alongside Q1 results.
“Tesla must keep up its rapid progress, even as competition intensifies, to even begin to justify the current valuation. The shares are already priced for perfection, so any slip-up will be punished,” was the Wild assertion.
On the macro front, US durable goods orders numbers for March are out soon.
“Following an unexpected decline in February, the headline orders are expected to rise 2.5% during the reported month. Core durable goods orders, which exclude transportation items and tend to have a broader impact than the volatile headline figures, are anticipated to have increased by 1.6% in March,” according to Fxstreet.com.
Four things to watch for on Monday:
- Companies in the earnings diary today include Brazilian metal miner Vale SA (NYSE:VALE), Dutch computer chip maker NXP Semiconductors NV (NASDAQ:NXPI) and software firm Cadence Design Systems Inc (NASDAQ:CDNS)
- Shares in Moderna Inc (NASDAQ:MRNA) could draw attention following news the company’s COVID-19 vaccine will be reviewed by the WHO for emergency listing on April 30, potentially speeding up its approval progress through national regulatory bodies
- Crypto market will also be in focus after Bitcoin rebounded back above US$50,000 after briefly hitting an eight-week low on Sunday night
- On the macro front, investors will be looking at the US durable goods orders for March as well as the latest Dallas Fed manufacturing index for April
Story by ProactiveInvestors
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