June 21, 2023: Tesla Soars, Nike Slumps, and European Stocks Retreat.

Tesla Shares Gained $44 Billion While Nike Suffered the Largest Daily Loss.

US indices closed with collective declines in Tuesday’s session, pressured by profit-taking after substantial gains last week and ahead of the Federal Reserve Chairman’s testimony before Congress on Wednesday.

The broad sell-off comes after the longest weekly winning streak in the Nasdaq since March 2019 and the longest since November 2021 for the S&P 500 index.

Yesterday’s data revealed a 21.7% increase in the pace of housing starts, reaching 1.631 million homes in May monthly, the largest monthly jump in 30 years.

  • US30: The Dow Jones index fell by about 0.72%, equivalent to about 245 points on Tuesday, marking the biggest daily loss in three weeks.
  • US500: The S&P 500 and Nasdaq Composite indexes declined by about 0.5% and 0.2%, respectively, and both indexes dropped for the second consecutive session from their highest level in 14 months.

Tesla shares: Tesla shares jumped more than 5% in Tuesday’s session to their highest levels in 9 months, with the stock’s gains reaching over 120% since the beginning of the year. The company added about $44 billion to its market value in one day, reaching around $870 billion.

Yesterday’s gains came after electric vehicle company Rivian announced that it had adopted Tesla’s charging standard.

News of Elon Musk’s plans to meet with the Indian Prime Minister in New York to discuss production operations in India also contributed to the stock’s gains.

  • Nike shares: Nike shares declined by 3.6%, marking their largest daily loss in a month, causing the company to lose over $6 billion of its market value in one session.

These losses came after Morgan Stanley bank stated that it expects margin pressures to increase in Nike due to the company’s inventory surplus.

 European Stocks Declined After UK Inflation Data.

 European stocks fell at the beginning of Wednesday’s session after inflation in the United Kingdom came higher than expected in May.

Today’s data showed that consumer price inflation in the UK remained stable at 8.7% in May, unchanged from the previous month, while a decrease to 8.4% was expected.

It is expected that the Bank of England will decide to raise interest rates by a quarter percentage point in tomorrow’s monetary policy meeting to tackle inflation.

  • STOXX600: The European STOXX600 index declined by 0.18% to 458 points at 08:38 GMT, with nearly all sectors falling.
  • FTSE100: The British FTSE100 index decreased by 0.39% to 7,540 points.
  • DAX: The German DAX index rose slightly to 16,114 points.
  • CAC 40: French CAC index declined by 0.2% to 7,279 points.

Japanese Stocks Rebound on SoftBank’s Surge and Positive Business Sentiment.

Japanese stocks rose at the end of Wednesday’s session, recovering from earlier losses, supported by the rise of SoftBank’s stock.

A monthly survey by Reuters showed that business sentiment among major Japanese manufacturers remained positive for the second consecutive month in May.

SoftBank Group’s stock climbed by 3.68% as the company held its annual general meeting today.

The Nikkei index ended the session with a 0.56% increase, reaching 33,575 points, while the broader Topix index rose by 0.49% to 2,295 points.

The U.S. dollar rose against the Japanese yen, gaining 0.37% to reach 141.80 yen.

Gold Prices Slide as Dollar Strengthens Amid Positive Housing Data.

Gold prices declined at the close of Tuesday’s session, June 20th, due to the dollar’s strength following the release of economic data.

At the close, gold futures declined by approximately 1.2%, or $23.5, to $1947.7 per ounce.

Economic data revealed that new home construction in the United States jumped by around 21.7% in May, reaching 1.63 million annually, indicating strong performance in the housing sector last month.

Housing data suggests that the economy remains in good shape, and the Federal Reserve is likely to raise interest rates again in July.

Federal Reserve Chairman Jerome Powell is scheduled to testify before the House and Senate, presenting his report on monetary policy and the economy to the House Financial Services Committee.

Disclaimer: This article is not investment advice or an investment recommendation and should not be considered as such. The information above is not an invitation to trade and it does not guarantee or predict future performance. The investor is solely responsible for the risk of their decisions. The analysis and commentary presented do not include any consideration of your personal investment objectives, financial circumstances, or needs.

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