• Local shares slumped on Friday after earnings report from giant miners
  • Nomura and Bank of America upgraded China’s growth
  • Cathie Wood sees Tesla at US$2k in 2027

 

Local shares slumped -0.3% on Friday, taking its weekly loss to around -0.40%.

Miners were the worst performing stocks after the release of earnings reports, while Energy and Industrial sectors led.

BHP (ASX:BHP) slipped 2% after cutting production targets for its Australian nickel and Chilean copper mines.

Although BHP’s iron ore output has hit a record for first nine months of the financial year, the company flagged that both the iron ore and coking coal divisions were heading towards the lower end of the target ranges announced previously.

BHP also announced the discovery of new copper porphyry just 140km from Phoenix, Arizona.

NOW READ: BHP – A new copper discovery and a record pace in iron ore highlight BHP quarterly

Energy giant Woodside Energy (ASX:WDS) recovered and closed flat despite reporting a 122% year increase in quarterly production of 46.8 million barrels, and a 81% year on year in revenue to $4.33 billion.

When you compare the figures to the last quarter however, production was down 9% and revenue was down 16%.

Meanwhile, bank stocks fell across the board as competition watchdog the ACCC said it was launching a probe into the savings rates offered by banks.

The ACCC is calling on banks and their customers to share their views by May 19th, ahead of a proposed Retail Deposits Inquiry.

 

Cathie Wood sees Tesla at US$2k

Ark Investment’s founder Cathie Wood says she sees Tesla share price to climb to US$2,000 in 2027 (versus US$163 now).

Wood told CNBC,” Our price target price for Tesla for 2027 is US$2,000 and that’s in the range of US$1,400 and US$2,500.”

Ark’s research report revealed more details about Tesla’s prospects, predicting that Tesla’s proposed robotaxi business will be a key driver in 2027, contributing 58% of expected enterprise value and 45% of expected EBITDA that year.

Electric vehicles will account for 62% of revenues in 2027, at substantially lower margins than robotaxi revenue. 

Meanwhile, there’s some good news elsewhere as Nomura and Bank of America analysts have upgraded their growth forecast for China to 6.3% (versus consensus of 5.3%). BofA says it expects strong domestic demand to drive China’s growth.

But investors are once again bracing for more problems in China’s property market, with the Dalian Wanda Group causing concerns after its US dollar bonds sank to distressed levels just months after they were issued.

The notes have dropped more than 20% this week as concerns about Wanda’s debt situation increased.

 

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Whitehaven (ASX:WHC) surged almost 6% despite revealing that its mine production has slumped 12% Q-on-Q over the three months to 31 March. WHC says sales of produced coal has slumped to 3.4 million tonnes, down 2% Q-on-Q and 5% Y-on-Y.

WHC held a monstrous net cash position of $2.7 billion as at 31 March 2023, after a $552 million tax payment (in relation to FY22) and returning $373 million of capital to shareholders during the quarter.

The world’s larger producer of rare earths outside China, Lynas Rare Earths (ASX:LYC), rose 4.5% after reporting an increase in sales revenue in the March quarter.

“The demand for Lynas’ NdPr product family from customers outside China remained very strong during the quarter,” the company said.

“This, together with excellent NdPr production volumes, resulted in strong sales performance in the quarter despite a decrease in the average selling price.”

 

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