Tesla slides, space stocks rise after Trump order barrage

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(Bloomberg) — Tesla Inc. On Tuesday, along with other electric-vehicle manufacturers, the shares of the aerospace company made big gains, after President Donald Trump announced a series of policies that could have a wide impact on the markets.

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In particular, Trump has ordered him to eliminate subsidies for EVs and policies that favor the vehicles, which weighed on Elon Musk’s company. In the year He announced plans to impose 25% tariffs on Mexico and Canada on February 1 and promised to put American astronauts on Mars in his inaugural address on Monday.

“As we enter Trump 2.0, the market appears to be reacting to headlines from the new administration,” said Walter Todd, president and chief investment officer at Greenwood Capital Associates. “This can increase the volatility of various financial markets.”

Investors are closely watching further actions from Trump to assess their impact on markets. JPMorgan Chase & Co. He is setting up a “war unit” just for this purpose. It is not yet clear how the policy proposals will be implemented. For example, stocks of companies with tariff risk are currently pushing the risks.

One area the new administration has yet to touch is cryptocurrency, which the industry is looking forward to.

“We’re seeing a few sell the news in hot market segments like Tesla and crypto,” said Chris Murphy, co-head of yield strategy at Susquehanna International Group. Even Chinese stocks, which benefited from Trump’s lack of temper, were largely unchanged and flat on the latest day of profit-taking.

EV slide

Tesla fell 4.7% and was the second-biggest weight in the S&P 500 index on Tuesday, while the Bloomberg Electric Vehicles Index slipped as much as 1.7%, after the Trump administration ordered the elimination of EV subsidies and other policies supporting the vehicles. . EV startup Rivian Automotive Inc. and Lucid Group Inc. So they failed.

While Trump has not explicitly ordered the Environmental Protection Agency to rewrite the rules, the directive sets the stage for steps that could delay the adoption of EVs in the US.

Space stocks jump

Shares of space companies have jumped on promises to land American astronauts on Mars to “pursue our manifest destiny to the stars.”

Intuitive Machines Inc., which built the lunar lander in a historic victory for private sector space exploration. As the stock jumped as much as 23 percent to post its best day in months, Rocket Lab USA Inc. and Redwire Corp. Both earned double-digit gains to record top spots.

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Shares of Trump Media and Technology Group fell as much as 14 percent in their worst day since the election week. Trump’s social media company has been prone to wild swings, with its stock up 22 percent as of Jan. 13.

Tariff tensions

Trump’s tariff plans hit Canadian energy and industrial stocks, but not as much as feared. For example, Meg Energy Corp. and Athabasca Oil Corp. are falling, but still retain some of their gains from Monday. Similarly, aircraft maker Bombardier Inc. fell 7.2 percent on Tuesday, down 6 percent.

The Nasdaq Golden Dragon China Index was little changed in the middle of the session as Trump did not announce tariffs on Chinese goods.

“While Trump likes to negotiate in public, it remains to be seen which bold tariff announcements will translate into policy change,” said Eric Sterner, chief investment officer at Apollo Wealth. He expects the new president to continue to “arm” the strength of the U.S. economy while trying to force concessions from other countries, but he doesn’t see them going far enough to stoke inflation.

Crypto breathes

Movements in cryptocurrencies and crypto-related stocks were muted after Trump’s first day without much-anticipated policy action to support digital assets. Shares of MicroStrategy Inc. fell 7.3 percent earlier but pared back most of that decline amid small gains and losses. Meanwhile, Coinbase Global Inc. It was also on the red-green line, and Hive Digital Technologies Ltd. and crypto miner Riot Platforms Inc. They were slightly lower. Bitcoin gained more than 3 percent to trade at $106,000.

Bloomberg reported last week that the incoming president is considering an executive order that would label cryptocurrencies a “national priority.” Before his inauguration, he and his wife Melania launched private memecoins.

–With assistance from Natalia Kniashevic and Isha Dey.