Tesla, Netflix drag Nasdaq down; Dow eyes ninth day of gains

Tesla, Netflix drag Nasdaq down; Dow eyes ninth day of gains

The Nasdaq experienced a decline on Thursday due to disappointing results from Tesla and Netflix, while Johnson & Johnson’s positive annual forecast boosted the Dow, which is on track for its ninth consecutive day of gains.

Tesla’s shares fell nearly 7% after the company reported a drop in second-quarter gross margins and CEO Elon Musk hinted at more price cuts. This news has raised concerns among investors, with Michael Matousek, head trader at U.S. Global Investors, stating that the price cuts have opened up competition among manufacturers in the electric vehicle (EV) space.

Other major players in the EV industry, such as General Motors and Ford Motor, also saw their shares slide over 1%.

Meanwhile, Netflix experienced a significant drop of 9.4%, its worst percentage decline in almost 15 months. The company’s quarterly revenue fell short of estimates, and analysts believe that its new ventures will take time to generate returns.

On the other hand, Johnson & Johnson’s shares rose 6% after the company raised its annual profit forecast, contributing to the Dow’s positive performance.

The Dow is currently on its longest winning streak in almost six years, with David Russell, vice president of market intelligence at TradeStation, attributing this to a shift in capital towards more traditional non-growth names.

The tech-heavy Nasdaq has seen a 35.5% increase so far this year, driven by the rally in megacap growth and technology stocks, as well as optimism surrounding artificial intelligence, the U.S. economy, and expectations of the Federal Reserve’s rate-hike cycle coming to an end.

As of 11:28 a.m. ET, the Dow Jones Industrial Average was up 0.75%, the S&P 500 was down 0.31%, and the Nasdaq Composite was down 1.20%.

United Airlines saw a 3.9% increase in its shares after raising its full-year profit outlook and reporting record-high quarterly earnings due to strong demand for international travel.

However, U.S.-listed shares of Taiwanese chipmaker TSMC fell 4.5% after warning of a 10% drop in sales for 2023.

Overall, second-quarter earnings across industries are expected to decline by 8.2%, according to Refinitiv data.

In other news, the number of Americans filing new claims for unemployment benefits unexpectedly fell last week, indicating strength in the labor market.

On the stock market, declining issues outnumbered advancers on both the NYSE and the Nasdaq.

The S&P index recorded 20 new 52-week highs and two new lows, while the Nasdaq recorded 46 new highs and 40 new lows.

This article was reported by Bansari Mayur Kamdar and Johann M Cherian in Bengaluru and edited by Shinjini Ganguli.

Our Standards: The Thomson RushHourDaily Trust Principles.

About News Team

Hi, I'm Alex Perez, an experienced writer with a focus on lifestyle and culture news. From food and fashion to travel and entertainment, I love exploring the latest trends and sharing my insights with readers. I also have a strong interest in world news and business, and enjoy covering breaking stories and events.

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