📈 Musk’s Robotaxi Revolution

Bull market turns 2, Bausch + Lomb deal becomes clear, SpaceX catches a rocket, Unions keep saying no, Hailing Tesla’s Robotaxi

Author

Evelio Silvera
October 14, 2024

Good morning.

⚡ The Fast Five → Bull market turns 2, Bausch + Lomb deal becomes clear, SpaceX catches a rocket, Unions keep saying no, Hailing Tesla’s Robotaxi

And now…

⏱️ Your 5-minute briefing for Monday, October 14, 2024:

MARKET BRIEF
Before the Open

As of market close 10/11/2024.

Pre-Market

  • Fastenal’s shares rose 9.8%, the top gainer on the Nasdaq.

  • Tesla fell 8.8%, the biggest drop on the Nasdaq.

Fear & Greed

*UP 0 pts

Trends

  • S&P 500, Dow hit records, boosted by bank earnings surprise

  • US credit spreads narrow to new lows as economy looks up

  • Futures mixed ahead of week packed with earnings, economic data

WHAT WE’RE WATCHING
Events

  • Thurs. Oct. 17: Census Bureau - Core Retail Sales (Auto), 8:30AM

  • Why You Should Care: It's the primary gauge of consumer spending, which accounts for the majority of overall economic activity.

Earnings Reports

  • Today: Karo

  • Tomorrow: United Health, Johnson & Johnson, Rio Tinto, Citigroup, Bank of America, Goldman Sachs, PNC, Ericsson

MARKET BRIEF
Leading News

Musk’s Robotaxi Revolution

Why it matters: Elon Musk just unveiled a game-changer—a future where robotaxis dominate the streets, reshaping transportation and creating new investment opportunities.

The big picture: Musk’s vision for unsupervised full self-driving (FSD) is coming closer to reality. Tesla (TSLA) is positioning itself to lead this seismic shift, with robotaxis as the next frontier. While the full rollout is a few years away, the potential for exponential growth is massive. If Tesla can crack the FSD code, they won’t just sell cars—they’ll disrupt the ride-hailing industry, with the ability to generate recurring revenue from autonomous fleets.

This isn't just about tech—it’s about redefining mobility. The total addressable market (TAM) for FSD is estimated in the trillions, and Musk’s plan to scale robotaxis globally could unlock entirely new revenue streams. Investors are watching closely as Tesla turns innovation into a competitive moat, potentially pushing the stock higher.

Go deeper:

  • Revenue driver: Tesla’s robotaxi model could generate revenue per mile, giving them an edge over traditional ride-hailing companies like Uber (UBER) and Lyft (LYFT).

  • Cost advantage: With no need for human drivers, robotaxis would drastically reduce operational costs, making ride-hailing cheaper and more profitable.

  • Tech hurdles: The biggest obstacle? Perfecting AI-driven FSD tech. But Musk’s bullish on Tesla’s ability to solve this within the decade.

What they’re saying: Musk confidently stated, “That’s what we want, and I think that’s what you want too.” It’s clear he believes Tesla’s ahead of the curve.

The bottom line: For investors, Tesla’s push into FSD and robotaxis represents a long-term growth story. As the company solidifies its leadership in autonomous tech, the potential upside could be huge. Look for dips as buying opportunities.

2-year Old Bull Market Has Room to Run

Why it matters: With fewer rate cuts on the horizon, investors remain unfazed—and that confidence could keep driving stocks higher.

The big picture: The two-year anniversary of the bull market has investors asking, "What’s next?" Despite fewer rate cuts expected from the Fed, stock investors are holding steady. Historically, markets are resilient to modest interest rate hikes, especially when economic fundamentals remain solid.

Rising interest rates typically increase borrowing costs, but with corporate earnings staying strong and consumer demand holding up, the market still has legs. Plus, a potential slowdown in rate cuts signals that the Fed believes the economy is on solid ground.

Even with inflation hovering, the underlying economic conditions—like a tight labor market and steady GDP growth—suggest that any dips could be opportunities, not setbacks.

Key points to know:

  • Earnings season is king: Companies continue to outperform expectations, with many in the S&P 500 ($SPX) showing resilience in sectors like tech and energy.

  • Rate hikes don’t kill bull markets alone: Historically, the market tends to rise even during periods of tightening, as long as the economy stays on track.

  • Crypto and tech on the rise: Investors are also eyeing crypto ($BTC), where recent adoption by institutions hints at long-term growth potential.

What they're saying: “Investors seem comfortable with the idea that the economy may not need lower rates to grow," says a leading market strategist.

The bottom line: With solid fundamentals, the bull market isn’t done yet. Savvy investors should stay the course and consider buying the dips in quality stocks.

Headlines

  • Unions Defy Their Leadership With More ‘No’ Votes on Contracts (link)

  • TPG, Blackstone bid for Bausch + Lomb in potential $14 billion deal (link)

  • SpaceX tower successfully ‘catches’ Starship booster (link)

  • Top silicon wafer maker Shin-Etsu readies chip equipment business (link)

  • European carmakers plan dozens of cheaper models to survive ‘EV winter’ (link)

  • China’s exports slow sharply in September, adding to worries over the economy (link)

CRYPTO
Fear & Greed

*DOWN 2 pts

Headlines

  • Bitcoin Mining Profitability Fell in September (link)

  • Altcoin Selling Pressure Looms as $500M in Token Unlocks Scheduled This Week (link)

  • Trump’s World Liberty Financial is using Aave (link)

DAILY SHARE
On the Socials

*Hat-tip to WorkRetireDie