US equity markets, particularly influenced by megacap tech stocks such as Tesla (NASDAQ:TSLA) and Netflix (NASDAQ:NFLX), exhibited signs of instability on Wednesday, largely driven by disappointing delivery numbers from Tesla and looming interest rate hikes. The Nasdaq index recorded a one-week low, declining 1.5% in both the session and over the past week.
Shares of Tesla (NASDAQ:TSLA) plunged 4.7%, hitting a two-week trough. According to the real-time metrics provided by InvestingPro, Tesla’s market cap stands at a whopping 770.74B USD, and it operates with a P/E ratio of 62.71. The company’s revenue for LTM2023.Q2 is reported to be 94.03B USD, reflecting a significant growth rate of 39.99%. Despite these impressive numbers, the company’s shares have seen a 3.1% decline in the past week. This is in line with one of the InvestingPro Tips, which suggests that Tesla’s stock price movements can be quite volatile.
Similarly, shares of Netflix (NASDAQ:NFLX) reached their lowest level since May, with a decline of 2.8%. Netflix’s market cap is 153.92B USD, and it operates with a P/E ratio of 36.37. The company’s revenue for LTM2023.Q2 is 32126.45M USD, with a growth rate of 3.53%. Over the past week, Netflix’s shares have seen a 2.79% decrease. This aligns with another InvestingPro Tip that suggests the company’s price has fallen significantly over the last three months.
In addition to this, NVDA is also feeling the impact of US export restrictions on chips to China.
Significant market fluctuations are anticipated post-earnings for both Tesla and Netflix. These could exacerbate the current market instability if their results prove unsatisfactory. An InvestingPro Tip suggests that 20 analysts have revised their earnings downwards for Tesla in the upcoming period, while for Netflix, revenue growth has been slowing down recently.
Adding to the prevailing uncertainty, as yields rise and the 10-year rate edges closer to the 5% benchmark, investors appear to be showing caution. It seems they may be waiting for this level to be reached before making any decisive moves in the market. For more insights and tips, consider checking out InvestingPro. The platform offers numerous other tips for both Tesla and Netflix, aimed at helping investors make informed decisions.
