The last trading day of the month is setting up as a test of the faithful—the Tesla faithful that is.
Pressure was building for the iconic car maker Friday after CEO Elon Musk got hit with a lawsuit from the SEC, which wants him out as head honcho after that now infamous taking-Tesla-private, “funding secured” tweet. Shares could be looking at their worst session in two years if premarket action is anything to go by.
From chat rooms and Twitter burning up over the topic, comes our call of the day from Ross Gerber, co-founder and CEO of Gerber Kawasaki Wealth & Investment Management, who says first and foremost, investors need to keep their cool.
“Don’t do anything emotional. First rule. Don’t let headlines scare you. The stock will go down tomorrow as it should, next week we can asses the issues more clearly with more information,” said Gerber in a tweet. He followed that up with a few more.
The SEC didnt remove Steven Cohen from the investment business for insider trading. I can’t think of anytime a CEO was removed by the SEC. Madden shoes maybe. So lets be real twitter. Name a few. $TSLA
— Ross Gerber (@GerberKawasaki) September 27, 2018
Gerber was getting a little flak for that tweet. Tesla was in his top five buys in the second quarter of 2018, according to 13F data, so clearly he sits on the side of the bulls. Those less in love with Tesla weren’t holding back:
— Grant Williams (@ttmygh) September 27, 2018
As for where shares go next, Mott Capital Management founder Michael Kramer said Tesla is nearing a big support level, given the late-session losses. “Support is now around the $250 level. If the stock falls below that, it could get much worse in a hurry,” he said in a blog post. After that, he said, look for support at $180.
Here’s his chart:
And in a case of viral stories colliding, one section of that SEC filing explains how Musk got to that $420-per-share public-to-private price tag.
“This calculation resulted in a price of $419 and Musk stated that he rounded the price up to $420 because he had recently learned about the number’s significance in marijuana culture and thought his girlfriend would ‘find it funny, which admittedly isn’t a great reason to pick a price,’” the statement said of the guy who triggered a 5% drop in shares earlier this month after appearing to smoke a reefer during an interview.
The eurozone is possibly plunging into a new crisis after Italy’s ruling antiestablishment parties pushed through a budget deficit target of 2.4%, putting the government on a collision course with the European Union. Economy Minister Giovanni Tria clearly caved in as he was looking for ballpark 1.6%.
On Friday, Italian stocks I945, -4.04% were getting crushed, down nearly 4% for their worst day since early 2016, with banks like Banco BPM SpA BAMI, -10.13% tumbling 7% in Milan. The chart of the day shows the choppy action over the last few sessions:
Painful day for Italy
Dow YMZ8, -0.34% S&P 500 ESZ8, -0.27% and Nasdaq NQZ8, -0.37% futures are barely budging. That is after the S&P SPX, +0.28% Dow DJIA, +0.21% and Nasdaq COMP, +0.65% all managed a higher close Thursday.
Gold US:GCU8 is slipping, while crude US:CLU8 is steady, but looking at a solid gain for the week. The dollar DXY, +0.32% is moving up, mostly against the euro EURUSD, -0.5497% which is taking a hit on Italy budget worries.
Europe stocks SXXP, -0.82% are falling, dragged by those slumping Italian stocks. Japan stocks NIK, +1.36% saw a powerful 5.5% gain for September, in what was a mostly upbeat day for Asian markets ADOW, +0.42% ADOW, +0.42%
Eli Lilly LLY, +0.36% says the FDA has approved the drug Emgality for preventing migraines in adults. It is one of three in a new class of drugs recently approved to revolutionize migraine treatment, all with identical $6,900 price tags.
A day after gripping testimony by judge Brett Kavanaugh and his accuser Christine Blasey Ford, attention will stay fixed on DC Friday as the Senate Judiciary Committee gets ready to vote on whether or not to move the Supreme Court nomination of Kavanaugh to the Senate floor for confirmation. Political betting market PredictIt says Kavanaugh’s odds of getting confirmed jumped after his testimony.
In the U.K., former foreign secretary Boris Johnson has come up with a post-Brexit plan B, laying on the criticism over Prime Minister Theresa May’s troubled Chequers compromise.
Personal income, consumer consumption, core inflation are due ahead of the open, with the Chicago purchasing managers index and consumer sentiment expected later.
Quote of the day
Judge Brett Kavanaugh on Capitol Hill September 27
“The basic principles that underscore the Senate’s constitutional duty of advice and consent on federal judicial nominees require nothing less than a careful examination of the accusations and facts by the FBI.” — That was a statement from the American Bar Association, obtained by CNN, calling on the Senate Judiciary Committee to delay ruling on nominee Brett Kavanaugh until the FBI completes its probe into allegations against him.
Earlier this month, the ABA gave Kavanaugh its highest “well-qualified” rating for his nomination.
46 passengers and 11 crew members on #AirNiugini flight that crashed in ##Chuuk, #FSM today. The airline confirmed that its Boeing 737-800 series aircraft, P2-PXE landed short of the runway whilst landing at Chuuk Island of the Federated States of Micronesia this morning. pic.twitter.com/kMhOvLWBdH
— makereta komai (@burebasgal) September 28, 2018
Miracle in Micronesia. Boeing 737 crashes into the sea, all 47 people make it out
Canada politicians unanimously vote to strip Aung San Suu Kyi of honorary citizenship over Rohingya crisis
Morning Joe’s co-host Mika Brzezinski says she had to ask five times before she got a raise
Video shows the moment Dutch cops foiled a massive terrorist attack plot
In a first, man charged with drunken driving—on a scooter
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