Weekly Roundup: Tesla Loses Executive, Nike Rebounds, Big Banks Tumble

On this episode of Stock Movers:

- Tesla (TSLA) shares fell on Friday after starting the week on the upswing. One of Wall Street’s most bearish Tesla analysts further reduced estimates for the company’s earnings, citing the magnitude of car-buyer backlash against Elon Musk. Tesla’s first-quarter vehicle deliveries were far below even JPMorgan Chase & Co. analyst Ryan Brinkman’s pessimistic estimate, “confirming the unprecedented brand damage we had earlier feared,” he said in a report Friday. The EV maker also saw a key executive leave. David Lau, Tesla's vice president of software engineering, has told people at the company that he is stepping down, according to people familiar with the matter. Lau, one of the few executives to promote the automaker’s products alongside Elon Musk, has been at Tesla for almost 13 years and has held the vice president title since 2017. His team is responsible for the software in Tesla’s vehicles — overseeing infotainment and information security to over-the-air software updates — as well as cloud services and manufacturing systems.

- Shares in companies that have large manufacturing operations in Vietnam, including Nike (NKE) and Lululemon Athletica (LULU) soared Friday after President Donald Trump said Vietnam was willing to eliminate tariffs to avoid new US levies. Nike shares erased an earlier loss to gain 3%. Apparel and shoemakers’ shares tumbled Thursday after the president unveiled a 46% levy on the Southeast Asian nation, where several had shifted manufacturing in recent years after Trump hit China with tariffs during his first term.

- Shares of big US banks plummeted, notching their biggest two-day drop since March 2020, after China escalated its trade war with the US.Some of Wall Street’s top lenders, Morgan Stanley (MS), Goldman Sachs (GS) and Citigroup (C) all closed more than 7% lower after China retaliated against President Donald Trump’s tariffs with a 34% levy on US goods. The KBW Bank Index tallied a roughly 16% drop over Thursday and Friday, the gauge’s worst two-session plunge since the start of the Covid-19 pandemic. Shares of JPMorgan Chase (JPM), which traded ex-dividend on Friday, erased some $51 billion from its market capitalization. Regional lenders also took a hit with the KBW Regional Banking Index slumping 3.7%, to close at the lowest level since July 9.

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Episode Transcript

Speaker 1 (00:02):
Bloomberg Audio Studios podcasts, Radio News, The.

Speaker 2 (00:08):
Stock Movers podcast, your roundup of companies making moves in
the stock market, harnessing the power of Bloomberg Data.

Speaker 1 (00:17):
Let's take a look at some stocks on the move
this past week. Bloomberg News Crossous that reported Deniza Sakova
on the week's stock movers, and we got to talk
about Tesla.

Speaker 3 (00:25):
It moved around a bunch.

Speaker 4 (00:27):
Yeah, we have to talk about Tesla. It was down
nine percent on the week, and Friday really was a
really tough end of a very tough week. We had
JP Morgan, one of the most bearish analysts on Tesla,
further reducing their estimates for the company earnings. They're of
course citing that report we got on Car on car

(00:48):
buying recently.

Speaker 5 (00:49):
And the backlash against Ewan Musk.

Speaker 4 (00:52):
Of course, on top of that, we have the broader
market salf putting pressure on all text sooks. On Magnificent
and seven we had done Nastak one hundred full into correction,
and later in the day we had even more bad
news from Tesla. As their vice president of software engineering
and one of the key people of the company, he's

(01:13):
been there for like thirteen years and you know, he's
been one of the people who has been all those
presentations together with Ellen Musk, and he's leaving the company,
so perhaps that's adding more pressure. The stock is down
forty percent here today, Yeah.

Speaker 6 (01:29):
And it's down fifty percent from its highs back in December.
What I find surprising Tanitza about this is we're not
at our low. We're not at our recent lows. I mean,
Tesla stock hit a low this year back in March,
like almost a month ago at this point. So unlike
some of the other stocks that really moved this week,
Tesla's not even on its you know, one month lows.

Speaker 5 (01:51):
Yes, true, Tessa was this big Trump trade.

Speaker 4 (01:55):
And you know, ever since the sock markets have been
going down, it's been one of the first that was
the hardest. And obviously there has been a lot of
talk that potentially it's not tariffs are not going awigh
on it so much.

Speaker 5 (02:07):
But some of the stocks that were hit a lot
of this.

Speaker 1 (02:10):
Did I just say, what's crazy is that earlier in
the week we actually saw Tesla rally because there is expectation.

Speaker 3 (02:16):
That maybe Elon do and ghost Tesla. Yes, exactly right.

Speaker 1 (02:21):
So his head of software engineering maybe leaving, but maybe
he's coming.

Speaker 5 (02:24):
Back that it feels like weeks ago.

Speaker 6 (02:26):
I'm just saying he's got like six or seven companies,
he's got more than a dozen kids. Like, just because
he leaves DOS doesn't necessarily mean he's going to be
donating all not donating, but you know what I mean,
spending all his time at Tesla.

Speaker 3 (02:37):
Right, but he could he could come back.

Speaker 6 (02:39):
Yes, that was the optimism.

Speaker 5 (02:40):
Yeah, that was optimism.

Speaker 3 (02:42):
It's still not great for the week overall, but they're.

Speaker 4 (02:44):
Saying, technically he's leaving, but he will still play an
important role.

Speaker 3 (02:47):
So I'm so confused. All right, what about Nike.

Speaker 5 (02:50):
Let's look at Nike. Nike had a rough day on Friday.

Speaker 4 (02:54):
It started lower, obviously after the big announcement nor on
Thursday of tariffs, which sent the stocks in turmoil. Nike
is still down on the week about ten percent, despite
the relief on Friday. So the relief on Friday came
after one of the first announcements of negotiations was coming
from Vietnam and President Trump had said he had a

(03:18):
very productive call. We know that about a half of
Nike branch shoes actually come from Vietnam, so you can
imagine that's why some of the relief came. It also
happened with Lemon, which also searched on the day. But
we recently had earnings from Nike that weren't painting so
much of a nice picture to it. They were saying

(03:40):
they have to clear out all the inventory, and Nike
shares really started to tumble after that earnings report, despite
some optimism earlier in the year about the rebranding about
you know, cattering two women the super Bowl ad, so
that optimism hasn't been enough to lift the stock lately.

Speaker 6 (03:58):
It's wild to look at the mac chart for this,
because you see that this stock is now trading at
levels last seen in twenty seventeen. That's crazy.

Speaker 5 (04:09):
Yeah, it's incredible.

Speaker 4 (04:11):
We were all talking about that turnaround effort, about the
new CEO, and clearly now it's not working so well.
But now it's we're in a macro market, so it's
a little bit different.

Speaker 3 (04:20):
All right. Can we talk bank stocks? They got hammered
this week.

Speaker 5 (04:24):
They got hammered.

Speaker 4 (04:25):
And we've been talking about that recession trade, and we've
been talking about credit, and we've been talking about stocks,
but really banks they had their biggest two day drop
since March twenty twenty, and of course this comes most
of it came on Friday when China warned against warrant
about escalating the trade war. Some of the big names

(04:47):
we're looking at, Morgan Stanley, Golden Sacks, City Group, most
of them are down about thirteen percent on the week.
So we also know that banks earnings are just around
the corner. Have JP Morgan, Wells Fargo, and Morgan Stanley
kicking off their important season April eleven, so.

Speaker 5 (05:07):
It's it's really close.

Speaker 4 (05:09):
But at the same time, banks are really carrying a
lot of that salef and under a lot of pressure
right before earning season, so you can imagine investors will
be particularly sensitive to any disappointment in that sector.

Speaker 6 (05:23):
One thing that we should note too is that as
of Friday evening, we heard from JP Morgan that it's
now projecting a US recession in twenty twenty.

Speaker 4 (05:34):
Five exactly Bruce Casman sixty percent of a chance of
a recession, which just a few weeks ago everyone was
talking about, how you know this is in the thirty percent,
it's unlikely.

Speaker 5 (05:46):
And everyone I've.

Speaker 4 (05:47):
Talked to about today, and I've talked to at least
five economists, everyone says more than fifty percent, So thanks
for moving fast.

Speaker 3 (05:53):
Yeah, it's really amazing.

Speaker 1 (05:54):
And this note also just like taking into account right
specifically what's going on for the likely impact of tariffs
announced this week, so really kind of fascinating to see
it was really all about kind of one major story
for the most part in terms of tariffs.

Speaker 2 (06:11):
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