February 4, 2023

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– Musk can pull many rabbits out of his hat – E24

It’s the last week of January and the monsoon season is slowly starting. On Wall Street, among others, Tesla will come under fire. Here at home, we also get to see how unemployment spread in December.

Nordnet investment economist Mads Johansen is interested in what tech companies have to say about the future because it’s been a tough 2022.
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In Oslo Borse, five companies will present their fourth-quarter numbers next week. These include Gjensidige Forsikring, seismic company PGS and shipping company Arne Fredly Hunter Group.

But this week, more eyes are likely to be turned to several important macroeconomic numbers in the US and companies listed on Wall Street. On Wednesday, among other things, stock favorite Tesla will open the accounting books for last year and the fourth quarter of last year.

The electric vehicle manufacturer’s share approached the year with big Christmas swings and a 69.2 percent decline for the year.

Investment economist Mads Johansen at Nordnet believes Tesla did relatively well in 2022 with both sales and production picking up. He is very excited about the road ahead.

It will be very interesting to see what ‘direction’ they come up with. Car sales are said to be on the decline, and the consumer has other things to think about in these inflationary times before considering a new car. So it’s not so important to be a car contributor in these times, Johansen tells E24.

Excited about Musk’s antics

However, he maintains that although Tesla’s share price fell last year from less than $400 a share to $123, the price is still high.

– There is still a lot of growth and good vibes added to that class. Tesla will probably always be priced higher than traditional automakers, both because they have a “first mover advantage” and because you never know what Elon Musk might come up with, says Johansen.

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53,000 Nordnet Norden customers have shares in Tesla. It’s one of the most popular stocks to own, says Johansen.

According to Johansen, the odd things Musk will come up with in the future will be important to shareholders. He’s caught up with the latest catch, as earlier this month Tesla dumped pricing for the Model 3 and Model Y.

Two things strike me: Either they’re struggling for sales or they’re going to compete on price and take larger market shares, Johansen says.

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The market is worried about two things

Musk’s antics also explain part of Tesla’s contraction in 2022, according to the investment economist.

Most of the problem now is that Musk has a lot of other things to do. Johansen says the market worries about two things: the use of his time and his financial situation.

Johansen indicates that he pledged his Tesla stock in connection with the loans he took out. to me financial times We’re talking about 63 percent of Musk’s Tesla shares.

– If Tesla’s price continues to fall and Musk puts a guarantee on a portion of the shares, many investors will wonder whether to force sell the shares to cover all of his financial obligations, says Johansen. He adds:

The more Musk is diluted, the less power he gets in his Tesla. too much he It is, after all, the company. So the class may become less interesting. But Musk can pull a lot of rabbits out of his hat.

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Unemployment is the number to watch, says Olaf Chen, Head of Allocation and Global Interest Rates at Storebrand.

Many are starting to feel the costs now

This is also the stage for several headline figures from the Norwegian economy during the week, not least the unemployment figures from Statistics Norway which will be released on Thursday.

Storebrand’s Head of Allocation and Global Interest Olaf Chen says the unemployment figures will be crucial to whether there is weakness in the Norwegian economy.

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– I think many companies are starting to feel the costs now, not just higher interest rates, but also electricity bills and lower demand, he says.

— But so far we’ve seen Christmas trade have been strong, but there have been several reports of layoff notices from several sectors, so the question is whether that will show up in the numbers to come.

The Labor Force Survey shows the percentage of the population between the ages of 15-74 who are employed and unemployed.

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Attention is the theme of 2022

Chen doesn’t think interest rates or inflation will be in the driver’s seat in 2023. He thinks this has been more of a topic than 2022.

The Bank of Norway and the US central bank will adopt what I call a wait-and-see attitude in the first half of the year, but the Bank of Norway is likely to raise interest rates for the last time in March, unless wage growth slows.

Chen points out that there is a clear relationship between lower unemployment and higher wage growth, and he worries that this may happen Wage and price spiral. Wage and price spiral. A “vortex” in which wages and prices influence each other, such that increases in prices lead to higher wages, and increases in wages lead to higher prices.

– If unemployment remains low, it will add more water to the factory to increase wages, thus escalating wages and prices.

Storebrand economist emphasizes the development in the labor market.

– Mine’s Recession Recession We experience a recession when the economy stops growing and contracts instead. When a country’s GDP, i.e. total value creation (sales of goods and services), has been declining for six consecutive months – it is common to say that you are in recession. But you can also go much rounder at the edges, like the US National Bureau of Economic Research. They describe a recession as a “significant decrease in economic activity” over time.Not two quarters of negative growth in gross domestic productgross domestic productGross Domestic Product (GDP) is equal to the sum of all goods and services produced in a country during a year, minus the goods and services used during that production.But when unemployment rises sharply.

The interest rate weapon may have to be used

Chen explains that higher wages are dangerous because they can lead to a corresponding increase in prices, in order to maintain company margins and compensate for increased labor costs.

– But in Norway we have not seen this, although unemployment is low in Norway, wage growth is not as high as unemployment would suggest.

He is excited about the results of this year’s payroll settlement, and notes that they may have an impact on Norges Bank’s interest rate peak.

– If settlements are higher than expected, Norges may have to do the same as we have seen in the US, where the interest rate weapon is used to avoid wage and price spirals.

However, Chen doesn’t think unemployment figures from Statistics Norway will show any surprises and describes it as a “bargain” in which the interest rate will be raised by 0.25 percentage point to 3 percent in March, unless something sudden and unexpected happens in the meantime.