Yesterday, the U.S. stock market closed early due to Independence Day, with the S&P 500 index and Nasdaq reaching new closing highs. Tesla (TSLA) shares surged 6.54%, marking the third consecutive day of strong gains. However, cryptocurrencies remained lackluster, with Bitcoin falling below 60K at one point yesterday, and Ethereum also dropping to 3,251 USD.
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Federal Reserve: Cautious Attitude Towards Inflation Progress
ADP Indicates Possible Slowdown in U.S. Labor Market?
Tesla’s Three-Day Rally, Stock Price Up Nearly 40% in One Month
According to a CNBC report, the minutes from the Federal Reserve’s June meeting released yesterday show that most members believe inflation is moving in the right direction, but not quickly enough to lower interest rates. The minutes reflect the diverse opinions of the 19 members involved in the discussion, some of whom even expressed a tendency to raise interest rates if necessary. However, the majority believe that economic growth is cooling down, and the current policy is “restrictive,” a key term as officials consider how restrictive measures need to be while reducing inflation without causing undue economic damage.
Since the meeting, Federal Reserve officials have generally maintained cautious wording, emphasizing “data dependence” rather than forecasts. However, several officials, including Chairman Powell, have stated that continued encouraging inflation data will provide confidence in lowering interest rates.
(The Dove Release by Powell Leads to a Rally in U.S. Stocks, Bitcoin and Ethereum Unenthused)
The ADP employment report, known as the “little non-farm,” showed that private employment in the U.S. increased by only 150,000 in June, less than the previous month’s 157,000 and below the expected 165,000, marking three consecutive months of slowing growth. This suggests that the momentum in the U.S. labor market may have weakened. The ADP report is a precursor to the non-farm employment numbers to be released by the Department of Labor on Friday. However, because the two statistics cover different scopes and methodologies, they do not always show the same trend.
Tesla’s stock price had been underperforming for nearly a year due to the overall car market not yet recovering and low-priced competition from Chinese electric vehicle manufacturers. While other tech giants were reaching new highs this year, Tesla’s stock price went against the trend, dragging down the overall market. However, the market sentiment has recently shifted. The day before yesterday, Tesla announced its second-quarter delivery volume, which, although 4.7% lower than the same period last year, surged over 10% in stock price as it was higher than analysts’ expectations. CEO Elon Musk is expected to present the Cybertruck and the new generation robot Optimus Gen 2 at the “World Artificial Intelligence Conference” (WAIC) in Shanghai on the 4th.
Tesla’s stock price has seen a strong rally for three consecutive days, with a nearly 38% increase in the past month.