Tesla Joins the S&P 500

Yesterday, the S&P 500 announced that it’s adding Tesla (TSLA) to its famous index. The stock will join up on December 21. By market cap, it will be one of the largest stocks in the S&P 500. After the announcement, the shares shot up 13% in yesterday’s after-hours trading.

Business Insider said it the announcement added $15 billion to Elon Musk’s net wealth and made him the third-richest person in the world. He just passed the Zuck.

Home Depot said that thanks to rising sales, it will spending $1 billion more on employee compensation.

Walmart reported very good earnings this morning. Walmart’s earnings report might as well be an American consumer spending report. Same-store sales rose by 6.4%. Expectations were for 3.8%.

Interesting detail from Walmart’s earnings report: in the US, transactions were down 14% but the average transaction price rose by 24%. Folks are shopping less but buying more.

E-commerce sales rose by 79%. For the quarter, Walmart made $1.34 per share which beat by 16 cents per share.

There were two economic reports this morning. Industrial production rose by 1.1%. Like so many other data series, IP has rebounded a lot but it’s still well below its high.

We also got the retail sales report. For October, retail sales were up 0.3%. That was a bit below Wall Street’s forecast of 0.5%. The good news is that September’s strong figure of 1.6% was revised even higher to 1.9%.

Excluding automobiles, gasoline, building materials and food services, retail sales nudged up 0.1% after a downwardly revised 0.9% increase in September. These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product. They were previously estimated to have risen 1.4% in September.

We’re probably looking at GDP growth of around 5% for Q4.

Posted by on November 17th, 2020 at 10:15 am


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