In today’s headlines, Elon Musk (pictured) tweeted that global Tesla production surpassed 3 million, Atlantic Lithium pursues a listing on the ASX and Saudi Aramco records bumper H1 profits. In other top stories, hedge funds squeeze meme stocks and pharmaceutical prices could be set to fall.
Tesla has built 3 million vehicles
Elon Musk congratulated Tesla’s [TSLA] gigafactory in Shanghai over the weekend for having produced its millionth vehicle. Global Tesla production has now exceeded three million in total, Musk tweeted. While the EV maker is heavily dependent on China, domestic production could get a boost from the Inflation Reduction Act, which would expand EV credits by lifting the existing 200,000 sales cap. It’s not clear which Tesla models would be eligible. The news has helped lift the Tesla share price, which is on track to close higher on Monday.
Lithium explorer to list in Australia
Miner Atlantic Lithium [ALL.L] is to be listed on the ASX from 23 August with shares priced at A$0.58. The West African explorer’s flagship Ewoyaa project in Ghana reported positive drilling results at the start of the month and will apply for a mining licence once it’s published its pre-feasibility study. Another exploration company, Future Metals [FME.L], saw its ASX-listed shares halted Monday in anticipation of a capital raise.
Saudi Aramco’s profits swell
Saudi Aramco [2222.SR] reported profits of $48.4bn for the second quarter on Sunday, swelling 90% year-over-year. The state-owned oil giant’s H1 profits of $88bn eclipsed Apple’s [AAPL] $79bn over the first three quarters of its fiscal year, as pointed out by MarketWatch. Aramco’s CEO Amin H Nasser told reporters that demand continues to be “healthy” despite global market volatility.
Hedge funds squeeze meme stocks
Share prices of Reddit crowd favourites AMC [AMC] and Bed, Bath & Beyond [BBBY] soared last week, closing 12 August 10.2% and 58.7% higher. Despite individual investors buying an average $1.35bn a day of US stocks so far this month, don’t expect a mega rally like the one seen last year, Bloomberg columnist Jared Dillian says. This is because the short squeeze “isn’t really r/wallstreetbets versus big bad hedge funds, it’s big bad hedge funds versus big bad hedge funds,” he explained.
Pharma to see lower drug prices
Drug prices could soon be lowered thanks to the Inflation Reduction Act giving Medicare more power to negotiate them down. Yet the pharmaceutical industry can breathe a sigh of relief, because the scope of their negotiating power is limited, according to UBS analysts. Writing in a note seen by CNBC, they said it would be “a clarifying event in terms of future industry earnings, removing the risk of more onerous drug pricing.”
FTSE 100’s most shorted stocks
The latest data from the Financial Conduct Authority shows that Asos [ASC.L], Boohoo [BOO.L] and Kingfisher [KGF.L] are three of the most shorted stocks on the FTSE 100, with the B&Q and Screwfix owner replacing knocking Cineworld [CINE.L] off the top spot. The online fashion retailers have seen their share prices come under pressure amid profit warnings and accusations of greenwashing, while Kingfisher has struggled as rising inflation impacts consumer spending.
Earnings preview: Tencent
The regulatory clouds over China’s big tech industry may be parting, but things are still looking gloomy for Tencent [TCEHY], which reports second quarter earnings on Wednesday. Like many other tech players, Tencent reported a contraction in advertising revenue in the first quarter due to weaker demand and regulatory changes, and this is likely to continue into the rest of 2022. Its gaming division is also expected to see a slowdown.
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