Can The Economy Weather Inflation, A Winter Storm, Elon Musk?

Zinger Key Points
  • Shares of electric vehicle maker Tesla Inc drop another 14% on the week and analyst says Elon Musk has severely damaged investor sentiment.
  • Following the Monday market holiday, investors will get more key economic updates on Tuesday.

The S&P 500 traded lower for the third consecutive week on concerns inflation may be more stubborn than anticipated.

On Friday, the Bureau of Economic Analysis reported the personal consumption expenditures price index increased by 5.5% year-over-year in the month of November, down from 6.1% in October. Core PCE, which excludes volatile food and energy prices and is the Fed's preferred inflation gauge, was up 4.7%, in-line with analyst estimates.

Shares of electric vehicle maker Tesla Inc TSLA dropped another 14% on the week to new multi-year lows and are now down more than 42% since CEO Elon Musk acquired social media platform Twitter in late October.

Oppenheimer analyst Colin Rusch downgraded Tesla from Outperform to Perform on Monday and said Musk's behavior since taking over Twitter, including temporarily banning multiple journalists, has "severely damaged" Tesla's investor sentiment.

See Also: Elon Musk's Favorite Crypto Dogecoin Didn't Have The Best Year — But It Still Outperformed Tesla In 2022

On Wednesday, the National Association of Realtors reported existing home sales dropped 7.7% on a monthly basis in November and were down 35.4% from a year ago. November marks the 10th consecutive month of housing sales declines as rising mortgage rates have weighed on homebuyer demand.

On Friday, FedEx and United Parcel Service warned customers that a massive winter storm sweeping across the country could delay holiday package deliveries. The storm brought bitter cold, snow, sleet and high winds through much of the country throughout the week, forcing airlines to cancel more than 6,000 flights and delay more than 20,000 others.

Sour BlackBerry
BlackBerry Ltd. BB shares dropped more than 20% this week after the security software and services company reported a $4 million net loss and an 8.1% decline in revenue in the third quarter.

In the week ahead, the third-quarter earnings season continues with reports from Outlook Therapeutics Inc OTLK on Tuesday, Cal-Maine Foods CALM on Wednesday and Uxin Ltd UXIN on Friday.

S&P 500 companies are on track to report full-year revenue growth of 10.4% in 2022, according to FactSet.

Economic Numbers
Following the Monday market holiday, investors will get more key economic updates on Tuesday when Standard & Poor's releases its October Case-Shiller Home Price Index reading and on Wednesday when the National Association of Realtors releases its November Pending Home Sales report.

Read Next: No Point Investing In Meta Platforms If Metaverse Pay Off Will Come In 2030, Bearish Analyst Says

Photo: AntonSokolov via Shutterstock

Posted In: NewsPenny StocksSmall CapTop StoriesBomb CycloneBureau of Economic AnalysisCase-Shiller Home Price IndexColin RuschfedexNational Assocation of RealtorsNational Association of RealtorsOppenheimerS&P 500Standard & PoorUnited Parcel Servicewinter storm
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