Tesla’s European Slide Signals a Deeper Reckoning for Musk’s EV Empire
Europeans continue to turn their backs on Elon Musk’s Tesla.
Wall Street Rattled as Trump’s Trade Gambit Roils Global Markets
The specter of “Liberation Day” ignites volatility, inflation fears, and a crisis of confidence from New York to Tokyo.
Wall Street Sees Signs That Worst of U.S. Stock Selloff Is Over
(Bloomberg) — Traders battered by one of the fastest U.S. stock slides on record may be poised for a reprieve.
Equity strategists at firms including JPMorgan Chase & Co., Morgan Stanley, and Evercore ISI are advising clients that the worst of the recent downturn is likely behind them, citing metrics from investor sentiment and positioning to favorable seasonality.
Major American stock indexes bounced back Monday after reports that President Donald Trump plans to take a more targeted approach with the tariffs he will roll out on April 2, easing some concerns that his escalating trade war will fan inflation and stall the economy.
Those worries — along with lingering fears that the artificial intelligence-fueled Big Tech rally had run too far — had knocked stocks down sharply since mid-February, sending the S&P 500 Index into its seventh-fastest 10% drop from a record high in nearly a century and erasing over $5.6 trillion from the index’s market capitalization, according to data compiled by Bloomberg.
JPMorgan said the bulk of that came from a cohort of momentum stocks, the 50 names with the strongest price performance in the S&P 500, which had erased two years of gains in three weeks. But the selloff also eased the crowding in the segment that had built up during the previous rally.
“As a result, the risk of another violent unwind should be low in the short term,” JPMorgan strategists led by Dubravko Lakos-Bujas said in a March 21 note to clients.
On Monday, pockets of the market that were hardest hit recently saw the biggest recoveries. A gauge of so-called Magnificent Seven stocks jumped 3.4%. Tesla Inc. soared 12% in the largest one-day gain since Nov. 6, the session directly after Election Day. The broader S&P 500 advanced 1.8%.
Morgan Stanley’s Michael Wilson joined Lakos-Bujas in striking a more optimistic tone, indicating that seasonal factors, a falling U.S. dollar, Treasury yields, and ultra-pessimistic sentiment and positioning are paving the way for a “tradeable rally in the near term.” And at Evercore ISI, chief equity and quantitative strategist Julian Emanuel said rhetoric on the economy by the Trump administration “has reset the bar such that sentiment is so negative right now.”
“We think the two steps backward portion we lived through is in the process of resolving itself, and you’re likely to get three steps forward toward higher prices,” he said.
The selloff has left Wall Street conflicted about whether the time has come to buy the dip, however, as the market continues to be shadowed by trade-policy uncertainty and concerns that the enthusiasm about artificial intelligence pushed tech valuations too high. While strategists see a period of calm ahead, they’ve largely avoided giving clients a resounding all clear to pile into U.S. equities for now.
That’s in significant part because Trump’s planned announcement of universal, reciprocal trade tariffs next month may again alter investors’ expectations about the economic fallout.
Evercore’s Emanuel said it’s the next catalyst for the market. Morgan Stanley’s Wilson says he’s also watching employment and manufacturing data along with earnings revisions as “signposts for a more durable rally.”
At 22V Research, chief market strategist and president Dennis DeBusschere on Monday said that market internals have improved in a way that suggests the U.S. economy is not moving into a recession. The unusually low investor sentiment — given the still solid economic data — suggests “stronger than normal returns” in the one-, three-, and six-month periods if the impact of tariffs wind up being minor. But like others, he’s waiting for more clarity around the levies to firm up his views.
“Assuming tariffs are not a major headwind to growth, fundamental factors should rebound throughout 2025,” he said. But “our conviction that tariffs will not lead to deeply negative outcomes is low, which is why we will wait until the April 2 announcement to press this longer-term view.”
With assistance from Matt Turner.
Is Moderna Stock a Sell as RFK Jr. Reportedly Mulls A Massive Funding Pull?
Moderna (MRNA) stock is under pressure, again, as new Health Secretary Robert F. Kennedy Jr. reportedly mulls pulling the company’s federal funding to develop a bird flu vaccine.
Chief Executive Stephane Bancel said recently that Moderna would work “productively” with the Trump administration.
“Vaccines are a very important piece of keeping people healthy and we look forward to having those discussions,” Bancel said on the company’s Feb. 14 earnings conference call with analysts.
But reports emerged recently that the Department of Health and Human Services it considering pulling the $590 million contract Moderna received in late January to develop a bird flu vaccine. The funding came from the Center for Biological Advance Research and Development Authority, a division of HHS. The funding was awarded several weeks before Kennedy was confirmed as the HHS secretary. Kennedy is a widely known vaccine skeptic who has called into question their safety.
The Food and Drug Administration also unexpectedly canceled the annual meeting scheduled for March to select the strains to target in this year’s flu vaccines. Moderna is testing a standalone flu shot in a two-season test that could wrap this year.
Moderna also reported steep losses for the fourth quarter, but topped sales expectations. The company kept its sales outlook for 2025.
So, all in all, is Moderna stock a buy or a sell today?
During the fourth quarter, Moderna lost $2.91 per share on $966 million in sales. Losses flipped from a year-earlier gain of 55 cents and missed forecasts for a narrower loss. Sales beat forecasts, but fell 66% year over year.
Both its products — Covid vaccine Spikevax and the respiratory syncytial virus vaccine called mResvia — beat sales projections. Spikevax generated $923 million in sales, ahead of calls for $909 million, while mResvia brought in $15 million in sales. Analysts polled by FactSet forecasted $13 million.
Moderna kept its outlook for 2025. It expects $1.5 billion to $2.5 billion in sales this year. The midpoint of the guidance is far below analysts’ call for $2.32 billion.
“While the third quarter represented an encouraging start to the company’s redesigned path on the cost-cutting side, today’s updates seemingly cloud the trajectory,” William Blair’s Minter said in a Jan. 13 report to clients following Moderna’s presentation at the J.P. Morgan Healthcare Conference.
Moderna stock fell by 17% that day.
The company is working hard to expand its portfolio.
Moderna’s technology focuses on helping the body create specific messenger RNA, or mRNA. When the mRNA sees a specific target in the body — like the spike protein on the coronavirus that causes Covid — it latches on, preventing the virus from spreading in the body.
Moderna expects the FDA to make an approval decision on its next-generation Covid vaccine in late May. The company is also working to expand its RSV vaccine to adults younger than age 60 and expects to have pivotal test data from its norovirus vaccine later this year.
Further, Moderna is working on a cancer vaccine in partnership with Merck (MRK). In this case, the mRNA grabs onto a specific target bespoke to each patient’s cancer. The companies are testing the cancer vaccine in combination with Merck’s blockbuster drug, Keytruda. Moderna stock surged more than 8% after Oracle (ORCL) Chairman Larry Ellison said in January that mRNA-based cancer vaccines could be developed in under 48 hours with the help of artificial intelligence.
But sales are expected to hit a floor this year. Analysts don’t expect Moderna to become profitable, on a strict, as-reported basis, until 2029.
Further, the company’s cytomegalovirus vaccine study missed its mark in a recent study. Cytomegalovirus, or CMV, doesn’t usually carry symptoms. But it can cause fever, sore throat, swollen glands, stomach pain and jaundice.
Moderna Stock’s Bearish Ratings
Moderna stock is showing bearish fundamentals and technicals.
First, shares are trading below their 50-day and 200-day moving averages, according to MarketSurge. Second, the stock is not forming a base for investors to watch. Even if it does, it will likely face a ceiling at its key moving averages.
Shares also have a poor IBD Digital Relative Strength Rating of 6. This means Moderna stock ranks in the bottom 6% of all stocks when it comes to 12-month performance. Moderna shares also have a low Composite Rating of 17, putting them in the bottom one-fifth of all stocks when it comes to technical and fundamental measures.
Its EPS Rating is its highest rating at a still-low 28. And Moderna is on track for years of losses. The company is working on cutting its costs and now expects to reduce its costs by $1 billion this year and $500 million next year.
Moderna stock peaked at 497.49 in August 2021, at the height of the Covid pandemic. Since then, the stock has fallen precipitously, down more than 93% over the past four years.
Despite a promising move after Ellison noted the potential for AI in cancer vaccine development, Moderna stock isn’t a buy.
In fact, shares were definitively a sell on Jan. 13 when they tumbled below their 50-day line. Though shares have made moves to retake their key line, Moderna stock has mostly closed below its 50-day moving average this year.
It could take several years for Moderna’s pipeline to really pan out, analysts say. In the meantime, its Covid vaccine has yet to hit a bottom and its RSV vaccine is coming from behind in competition with Pfizer (PFE) and GSK (GSK).
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Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.
