Investment Focus For Next Week

Overview

The United States and Europe October PMI preliminary values, Tesla fired the "first shot" of the technology giants' earnings season. China's October LPR quotation and MLF operating rate, September industrial enterprise profits

In addition, the 2024 IMF and World Bank Autumn Annual Meetings will open, the United States will release the Beige Book on economic conditions, and Coca-Cola, IBM, etc. will release their latest earnings reports.

Federal Reserve "Beige Book"

On Thursday (October 24), the Federal Reserve released the "Beige Book", a national economic situation survey report compiled by 12 regional Federal Reserve banks.

The report released last month showed that economic activity in most parts of the United States was flat or declining, and consumer spending slowed; the labor market was mixed, companies were reluctant to expand recruitment, but layoffs were still rare; prices rose slightly, but not by much.

The "dot plot" released after the FOMC meeting last month showed that Federal Reserve officials had differences on the future path of interest rate cuts. At the press conference after the meeting, Powell emphasized the importance of paying attention to the Federal Reserve Beige Book:

Since the last meeting, we have received a lot of data, including two non-farm employment reports in July and August, and two inflation reports, one of which was released during the silent period of Federal Reserve officials. There is also a QCW report that shows that our non-farm new employment may be artificially inflated and will be adjusted down.

We also see anecdotal data like the Beige Book from the Federal Reserve, so we collect all of that data and then we go into a quiet period of speaking publicly and we think about what to do and make it clear that this is the right thing for the economy, for the American people that we serve, and that's how we make our decisions.

October PMI

On Thursday (October 24), the eurozone and the United States successively released the preliminary PMI values for October.

The US Markit Manufacturing PMI hit a 15-month low in September, the expansion of the service industry slowed down, and price pressure reappeared.

The preliminary value of the manufacturing PMI in September fell to 47, the lowest level since June 2023; the preliminary value of the service industry PMI in September was 55.4, a two-month low; the preliminary value of the Markit Composite PMI in September was 54.4, also a new low since July 2024.

Data released last month showed that the eurozone's manufacturing PMI hit a new low this year in September, and both Germany and France accelerated their contraction, and the economy showed signs of weakness again.

Can Tesla's financial report regain market confidence?

Tesla will release its third-quarter financial report on Thursday (October 24).

According to Bloomberg analysts' general expectations, Tesla's Q3 revenue was US$25.42 billion, a year-on-year increase of 9%; earnings per share were US$0.51, a year-on-year decrease of 4%.

AI products and services have been seen as the next catalyst for Tesla's growth, and investors expect Tesla to give positive outlook guidance at the press conference.

Previously, the market was not satisfied with Musk's Robotaxi answer sheet, causing its stock price to fall sharply.

Mainstream Wall Street commented that Tesla's Robotaxi "lacks immediate delivery results or incremental revenue drivers", and investors will "refocus on the company's fundamentals", but the company's fundamentals are "quite bad", and the core reason is still the high valuation of Tesla's stock and the reality that earnings growth has hit a wall.

Some analysts say that as the market's attention increasingly turns to profits, Tesla's stock price may continue to face pressure due to continued headwinds in the automotive industry.