Week Ahead on Wall Street: Tesla’s piece of the pie

By: Anneken Tappe · October 16, 2023 · Reading Time: 3 minutes

Will Tesla Win the EV Race?

Electric vehicles are popular, but for resident market leader Tesla (TSLA), recent figures from Cox Automotive tell a mixed story.

For the first time ever, EV sales crossed the 300,000 threshold in a single quarter. But as the broader EV market blooms, Tesla’s piece of the pie appears to be dwindling. In less than a year, Tesla has receded from a commanding 62% market share in the first quarter to just 50%. Meanwhile, multiple price cuts for the Model 3 and Model Y signal Tesla’s intent to maintain its grip in the highly competitive space.

Still, with the imminent launch of the Cybertruck, there’s optimism in the air. The electric pickup truck, scheduled for delivery this quarter, may be just what Tesla needs to get back on the road toward market dominance.

With these dynamics at play, Tesla’s quarterly earnings call this Wednesday could be a crucial touchpoint for investors.

Economic Reports

The week is starting out on a quiet note, with the spotlight on the NY Empire State Manufacturing Index. After a decline in the previous month, it rebounded in September, indicating some stabilization in business activity in the New York state region.

On Tuesday, we will get a look at September retail sales. In August, U.S. retail sales recorded a promising 0.6% growth month-over-month, hinting at continued consumer spending despite mounting costs.

Housing market data will dominate on Wednesday, with building permits, housing starts and an update on the 30-year mortgage rate. At last reading, the average mortgage rate hit its highest level since November 2000.

And as usual, the Department of Labor will reveal initial jobless claims for the week ended October 14.

There will also be several speeches from Fed officials throughout the week. Chairman Jerome Powell will speak at the Economic Club of New York on Thursday.

Earnings Reports

Charles Schwab (SCHW) will kick off the earnings week. While the company surpassed expectations last quarter, year-over-year revenue declined 9% due to customers reallocating to higher interest rates.

Tuesday is a busy day with several big names releasing earnings. Albertsons (ACI), Bank of America (BAC), Goldman Sachs (GS), and Johnson & Johnson (JNJ) are among the headliners.

On Wednesday, heavyweights Morgan Stanley (MS), Procter & Gamble (PG), Tesla (TSLA), and Netflix (NFLX) will all report earnings. Last quarter, Netflix said the full benefits of its crackdown on password sharing and ad-supported tier on revenue would be reflected in the second half of the year.

On Thursday, AT&T (T) and Blackstone (BX) will step into the spotlight. In the previous quarter, AT&T’s cost-cutting plan led to operating expenses dropping $1 billion. The company is now targeting another $2 billion or more over the next 3 years.

On Friday, American Express (AXP) will conclude the earnings week. In the previous quarter, the company reported record revenue and highlighted its extended partnership with Hilton (HLT).

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