Dow edged up 28, decliners over advancers 4-3 & NAZ added 22. The MLP index slid 1+ to the 286s & the REIT index dropped 4+ to the 431s. Junk bond funds drifted lower & Treasuries saw selling, driving yields higher. Oil jumped 1 to almost 71 on growing tensions in the MidEast (more below) & gold dropped 22 to 2667.
Dow Jones Industrials
Tesla (TSLA) reported posted its 3rd-qtr vehicle production & deliveries report. Total deliveries Q3 2024 were 463K total production was 469K. The forecast expected deliveries of 463K in the period ending Sep 30. Deliveries are not defined in TSLA's financial disclosures, but are the closest approximation to units sold reported by the company, 1 of the most closely-watched metrics by analysts. In the year-ago period, TSLA reported 435K deliveries & production of 430K EVs. Last qtr, the company reported 444K deliveries & production of 411K vehicles. TSLA is facing increased competitive pressure, especially in China, from companies like BYD & Geely, along with a new generation of automakers, including Li Auto & Nio. TSLA hasn’t issued specific guidance for 2024 deliveries, but execs have said they expect a lower delivery growth rate this year versus last despite the company having added a new vehicle, the angular stainless steel Cybertruck, to their lineup. Musk has promised TSLA self-driving cars for years, but the company has yet to deliver. Meanwhile competitors like Waymo & Pony.ai have begun operating commercial robotaxi services. The stock dropped 9.24 (3.6%).
Tesla stock slips after EV maker misses estimates on deliveries
Private sector hiring picked up in Sep, indicating the labor market is holding its ground despite some signs of weakness, payrolls processing firm ADP reported. Companies added 143K jobs for the month, an acceleration from the upwardly revised 103K in Aug & better than the 128K forecast. While hiring increased, the rate of pay growth took another step down. The 12-month gain for those staying in their jobs nudged lower to 4.7%, while tumbling to 6.6% for job switchers, down 0.7 percentage point from Aug. Job gains were fairly widespread, with leisure & hospitality leading at 34K, followed by construction (26K), education & health services (24K), professional & business services (20K) & other services (17K). Information services was the lone category posting a loss, down 10K. Service providers accounted for 101K of the total, with goods producers adding the rest. From a size standpoint, all of the growth came from companies with more than 50 employees. Small firms saw a loss, with those employing fewer than 20 workers down by 13K.
Private payrolls show better-than-expected growth of 143,000 in September
US crude oil rose nearly 3% as traders fear Israel could target Iran's oil infrastructure in retaliation for a ballistic missile attack. Israel's ambassador to the UN, Danny Danon, vowed yesterday that Israel will exact a “painful” response against Iran. His threat came hours after the Islamic Republic launched around 180 ballistic missiles at Israel in retaliation for the assassination of top Hamas & Hezbollah leaders. West Texas Intermediate Nov contract is $71.86 per barrel, up $2.03 (2.9%) & YTD US crude has gained less than 1% & Brent Dec contract is $75.50 per barrel, up $1.94 (2.64%) & YTD the global benchmark, is down about 2%. The geopolitical risk premium, however, should remain moderate given high spare oil capacity globally & the fact that there have been limited actual production disruptions. OPEC+ is planning to increase oil production in Dec. US output has been set records & demand in China, the world's largest crude importer, has also been soft this year.
Crude oil jumps nearly 3% as Israel vows ‘painful’ response to Iran missile attack
Escalating Israel-Iran tensions fanned worries about a wider Middle East conflict, prompting caution in the market as Israel weighs response to Iran missile attack. Growing geopolitical concerns grip the market, dispelling the upbeat mood around hopes for US interest rate cuts. At the same time, oil has extended a surge that saw prices spike over 5% yesterday, the most in almost a year. In focus are the chances the run-up in oil prices could push up US inflation, disrupting the progress made by the Federal Reserve. At the same time, MidEast tensions & the US port strike risk hampering supply chains, spurring concerns about the US economy, just when investors were becoming confident in a "soft landing."
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