So it’s not a full-scale hemorrhage, but markets have been draining valuations. All four major indices are down over the past week of trading, with only the small-cap Russell 2000 making a push back toward those highs. At this hour in the pre-market, the Dow is down -225 points, the S&P 500 is -55 and the Nasdaq -300 points. The Russell is down -15 points at this hour.
Tesla TSLA shares are down -8% after yesterday afternoon’s Q2 miss. Other companies reporting Tuesday afternoon — like Alphabet GOOGL and Seagate STX — outperformed expectations, but Tesla was the company investors were hoping would demonstrate it’s on the rebound. Perhaps it is, as the company did beat on its top line, but deliveries again look to come in short for the year. Also, Visa V beat by a mere penny — a close call for a company that literally never misses on earnings.
This morning, Advanced Trade in Goods results are out. The June tally trimmed to -$96.84 billion from the expected -$98 billion and the previous month’s -$99.4 billion (which amounted to a two-year high, or low, depending how you look at it). Both Imports and Exports were up, but Exports rose by +$4.3 billion while Imports grew +1.7 billion. Coming off those near-term lows, we remain pretty much where we’ve been post-pandemic: still in a deep hole, but at least we’re not still digging.
Advanced Retail Inventories for June were also posted this morning. The headline $539.4K marks the third-straight sub $540K print, and roughly equates inventories we saw back in May 2022. It was nearly a year ago, August 2023, when we saw a record high $563.8K, so at least we’re adjusting the right direction. June Wholesale Inventories grew at a smaller +0.2% than the +0.5% expected and the +0.6% reported a month ago. This marks the fourth month in six with higher wholesale inventories.
After today’s close, we’ll get two important Q2 earnings reports. To be clear, there will be many more Q2 releases today as earnings season continues to heat up, but Chipotle CMG and Ford F give unique glimpses into consumer trends with discretionary spending on items big and small. Chipotle is expected to bring +24% earnings growth on +16% revenues in the quarter, while Ford looks to come in -11% in earnings from a year ago and -2.2% on revenues. Ford has missed earnings estimates in five of the last 10 quarters, while Chipotle has but one miss in the past three years.
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