Tag: selloff

  • Tata Group Stocks Slide as SP Group Moves to Monetize Rs 25,000 Crore Stake

    Tata Group Stocks Slide as SP Group Moves to Monetize Rs 25,000 Crore Stake

    Tata Group stocks witnessed a sharp decline on Friday as the SP Group announced plans to monetize its stake in Tata Sons, targeting at least Rs 25,000 crore through two transactions over an 18-month period. The proposal reignited concerns about ownership structure and governance within the conglomerate, triggering a selloff across key listed entities.

    Market Reaction

    Tata Chemicals led the decline, dropping as much as 7.8% during early trading. Tata Investment Corporation slipped nearly 3.9%, while TCS fell 3%. Tata Motors Passenger Vehicles declined 2.6%, and Tata Power was down 1.4%. Meanwhile, Tata Steel remained almost flat, and Tata Capital gained around 1.1% in early market hours.

    SP Group’s Proposal

    The SP Group, led by Cyrus and Ratan Tata’s estranged factions, seeks liquidity from its Tata Sons holdings without immediately forcing a public listing. The proposed transaction involves shares held through Sterling Investments Corporation and Cyrus Investments. Under the plan, Tata Sons could pursue selective capital reduction through the National Company Law Tribunal (NCLT).

    Governance Disputes Intensify

    The proposal adds to ongoing tensions over Tata Sons’ leadership and future listing ambitions. The board recently approved N Chandrasekaran’s five-year reappointment as executive chairman and moved toward exploring a public listing for the holding company. However, Tata Trusts, the majority shareholder, opposed both developments, stating, “The Trusts’ position remains unchanged, as a considered judgement of a majority shareholder.” The Trusts urged the board to consider alternatives beyond listing.

    Adding to the regulatory pressure, the Reserve Bank of India (RBI) rejected Tata Sons’ request to surrender its Core Investment Company registration, keeping it within the Upper Layer NBFC framework.

    Impact on Listed Entities

    The ownership structure links several listed Tata companies to Tata Sons’ fortunes. Tata Chemicals, Tata Motors, and Tata Investment hold stakes in Tata Sons, making their valuations indirectly sensitive to these developments. According to ICICI Securities, Tata Chemicals holds around 2.5% in Tata Sons.

    Friday’s selloff reflects uncertainty surrounding Tata Sons rather than operational weakness in the individual businesses. The previous day’s rally, driven by the leadership decision and renewed listing expectations, has now reversed as investors reassess the implications of the SP Group’s proposal.

  • Tesla Stock Drops Near $300 After Q2 Earnings Miss Triggers Market Selloff

    Tesla Stock Drops Near $300 After Q2 Earnings Miss Triggers Market Selloff

    Tesla shares fell nearly 15% after second-quarter results raised concerns over weaker margins, negative free cash flow, and rising AI spending. The selloff pushed the stock toward the $300 support area and added pressure to the NASDAQ, while Bitcoin and Ether also declined as risk sentiment weakened.

    Tesla shares closed at $313.03 on July 24 after falling 2.08% during the session. The stock also slipped to about $311.40 in after-hours trading. Over one month, Tesla lost around 16.55% as investors reassessed the company’s second-quarter results and spending plans.

    The latest decline followed a 14.52% plunge on July 23. Tesla reported record vehicle deliveries and higher revenue, yet weaker margins and negative free cash flow drew more attention. The stock now trades close to the lower end of its recent range, with $300 becoming the nearest major technical level.

    Tesla Stock Nears Key $300 Support

    Tesla stock traded as high as $322.87 on July 24 before falling to an intraday low near $306.53. Selling pressure stayed firm after the earnings-driven decline. As a result, the shares closed only a few dollars above their first major support zone.

    The area between $306.50 and $300 now serves as short-term support. A sustained close below $300 could bring the 52-week low near $297.82 back into focus. On the other hand, buyers need to reclaim the $320 to $323 range to slow the current decline.

    Stronger resistance sits between $340 and $342. Tesla traded near that area before the post-earnings gap widened. A recovery toward that range would require stronger demand and improved confidence in the company’s profit outlook.

    Record Deliveries Fail to Calm Investors

    Tesla delivered a record 480,126 vehicles during the second quarter. The total exceeded the company-compiled estimate of about 406,000 vehicles. Model 3 and Model Y deliveries reached 467,762 units and accounted for most of the quarter’s volume.

    Revenue rose 26% from a year earlier to about $28.24 billion. Automotive revenue reached nearly $20.5 billion, while services and other revenue increased 50% to $4.58 billion. These results showed that Tesla continued to expand sales across its main business lines.

    Nevertheless, investors focused on profitability. Tesla’s operating margin fell to 1.4% from 4.1% a year earlier. Lower vehicle prices and higher costs supported deliveries but reduced earnings from each sale.

    The weaker margin also raised questions about how quickly Tesla can turn rising sales into stronger cash generation. This issue became more important as the company increased spending on artificial intelligence, batteries, robotics, and autonomous-driving systems.

    AI Spending Adds Pressure Across Markets

    Tesla’s capital expenditure reached about $5.8 billion during the quarter. Free cash flow turned negative by roughly $1.1 billion, marking the company’s first quarterly cash burn in more than two years. Tesla also expects annual capital spending to exceed $25 billion.

    The company continues to fund robotaxi development, artificial intelligence infrastructure, next-generation manufacturing, and the Optimus robot program. Meanwhile, investors are waiting for clearer revenue growth from these projects as costs rise in the near term.

    The concern spread beyond Tesla. Alphabet shares also fell as investors reviewed higher artificial intelligence spending plans. It raised its 2026 capital expenditure guidance to between $195 billion and $205 billion, up from its earlier range.

    The NASDAQ moved lower as investors reduced exposure to high-growth technology stocks. Risk-off trading also reached digital assets. Bitcoin fell about 1.8% toward $64,800, while Ether dropped around 3% to nearly $1,870. Concerns over technology spending affected several risk markets during the same trading period.

  • Tesla and SpaceX Stock Slide Hits Retail Investors as AI-Led Rally Fades

    Tesla and SpaceX Stock Slide Hits Retail Investors as AI-Led Rally Fades

    Retail investors are facing significant losses after a sharp decline in Tesla and SpaceX shares, following a strong rally earlier this year. The downturn has affected global investors, including those in India who purchased U.S. stocks through international platforms.

    Tesla is currently trading near $393, roughly 21% below its 52-week high of $498.83. SpaceX has fallen about 30% from its post-listing intraday high of $225.64 to around $157–158. The company debuted on Nasdaq on June 12 after pricing its IPO at $135 and opening at $150.

    The correction has also eroded Elon Musk’s paper wealth. His net worth briefly surged after the SpaceX listing but later dropped below the trillion-dollar mark as both stocks weakened. For retail investors, the focus has shifted from Musk’s fortune to their own exposure in these two volatile stocks.

    Why Tesla and SpaceX Fell After Strong Performance

    Tesla’s decline came despite the company reporting strong second-quarter delivery numbers. This indicates that investors are looking beyond vehicle sales and weighing future plans in autonomy, robotaxis, and AI-linked businesses. SpaceX faces a different challenge: its Starlink, rocket launch, and space infrastructure businesses have drawn interest, but a limited public float has amplified price swings.

    The correction has already triggered selling by some investors. Tesla has appeared among the most sold stocks on Vested Finance, according to platform data. SpaceX also saw strong retail demand after its IPO, including from Indians investing under the Liberalised Remittance Scheme (LRS).

    Viram Shah, founder and CEO of Vested Finance, explained that the selloff reflects both business expectations and broader market repricing. “One is the actual businesses, and the other is the way the market’s re-pricing a whole basket of AI-linked names right now,” he said.

    AI-Linked Valuations Under Scrutiny

    Shah noted that Tesla’s recent stock move shows the market is not solely focused on cars. “Tesla just posted its strongest Q2 deliveries in a while, and the stock still fell. That tells you the move isn’t really about cars,” he said. He added that investors are questioning how much of Tesla’s valuation should depend on autonomy and robotaxi plans, which may take time to prove.

    SpaceX has faced pressure despite strong interest in its core business. “Starlink’s profitable and growing, the launch business is setting records; what’s moving the stock is a very thin float and a premium valuation, so any selling gets magnified,” Shah said.

    The broader market mood has turned cautious toward AI-linked stocks. Investor Michael Burry, known for his bet before the 2008 housing crash, has disclosed bearish positions against Tesla and other AI-related names, adding concern that some technology shares may have outpaced earnings support.

    Shah described the current fall as a mix of profit-booking and a market re-rating. “You had a near-vertical run in SpaceX right after listing and a strong 2025 in Tesla, so some of this is just gains being taken. But underneath it, the market’s asking a harder question about how it wants to price these AI and space bets, and that’s the re-rating part.”

    Advice for Indian Retail Investors

    For Indian investors, experts recommend reviewing portfolio allocation rather than reacting to price moves. Selling only during a fall can lock in losses, while buying more at a lower price can increase risk. High-growth stocks like Tesla and SpaceX can move sharply, with large portions of their valuations depending on future businesses.

    Investors should check whether one or two U.S. stocks have become too large in their portfolio. A long-term investor may view short-term volatility differently from someone with a shorter time horizon. However, a large position can heighten risk even if the company’s business remains strong.

    “A great company and a great entry price aren’t the same thing,” Shah said. “For Indian investors going global through the LRS route, the discipline’s the same as always: size it so a rough quarter is a nuance in the portfolio, not the whole story.”

    Newly listed stocks can remain unstable for several quarters. SpaceX still has a limited public float, and future lock-up expiries may add more shares to the market, potentially affecting prices.