After Market: Dow Sets a Record, but Troubles at Tesla Drag Down Nasdaq

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The Dow jumped to another record high Wednesday, but the Nasdaq was pulled down mostly by one stock.

The Dow industrials (^DJI) rallied 128 points to 15,747, topping the all-time high set last week. The S&P 500 (^GPSC) rose 7 points to 1,770, but the Nasdaq (^IXIC) lost 8 points to 3,932. Overall, investors were cheered by some good economic news out of Germany and the U.K.

17, June, 2012, Oak Brook, Illinois, USA. Prospective customers consider the new Tesla Motors Model S. The Model S, an all elect
Alamy
The Nasdaq was slammed by Tesla (TSLA), which skidded 14 percent. Shares of the luxury carmaker had raced ahead over the past six months, but investors applied the brakes after a disappointing earnings forecast for the fourth quarter. Tesla is struggling to meet consumer demand because of limited capacity. Among the things that are limiting Model S production: A shortage of the lithium-ion batteries that power it.

The Nasdaq was also hurt by losses in some tech and biotech stocks.

Also getting trampled: shares of Abercrombie & Fitch (ANF). We used to call it the trendy retailer. Now it's the beleaguered retailer. Sales have been tumbling, dragging its stock down too. Shares slid 13 percent Wednesday. That also weighed on rivals Aeropostale (ARO), down 8 percent, and American Eagle (AEO), down 4 percent.

Leading the blue chip rally was Microsoft (MSFT), up 4 percent, to its highest level since the tech bubble days of 2000. The company has reportedly narrowed its list of candidates to succeed Steve Ballmer as CEO. Ford Motor (F) chief Alan Mullaly is said to be on the short list, along with at least two internal candidates. A prominent analyst also raised his earnings outlook on Microsoft.

Other blue chip winners include Chevron (CVX) and UnitedHealthcare (UNH), both up more than 2 percent.

Barracuda Networks, which provides cloud computing services, jumped 22 percent from its IPO price of $18 a share. There have been more IPOs in 2013 than in any year since before the financial crisis. Of course, the most talked about one comes Thursday with the debut of Twitter on the NYSE.

Open Table (OPEN), the restaurant reservation company, jumped 12 percent after posting much stronger than expected earnings.

EBay (EBAY) was bid up by 4 percent on rumors that investor Carl Icahn may be buying a big stake.

And Activision Blizzard (ATVI) was flat even though the game-maker says sales of the new version in its "Call of Duty" franchise topped $1 billion in its first 24 hours.

What to Watch Thursday:
  • Twitter makes its debut on the New York Stock Exchange under ticker symbol "TWTR."
  • 8:30 a.m.: The Labor Department reports weekly jobless claims and the Commerce Department its initial assessment of U.S. economic growth for the quarter ending Sept. 30.
  • 3 p.m.: The Federal Reserves releases September data on consumer credit.
These major companies are due to report quarterly corporate earnings:
  • Beazer Homes (BZH)
  • Chesapeake Utilities (CPK)
  • Groupon (GRPN)
  • Prestige Brands (PBH)
  • Priceline (PCLN)
  • Visteon (VC)
  • Walt Disney (DIS)
  • Wendy's (WEN)

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19 Comments

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cjaneke

Tesla is like a Tulip in a rosegarden. Remarkable manifestation but a lot of pricks around..

November 07 2013 at 4:32 AM Report abuse rate up rate down Reply
john.sodano

I read that there was another Fire today in Tennessee (Tesla model S). Although I like the car, the idea of all electric (with a good amount of range), and the performance, I do not think all the other manufacturers are going to roll over and die.

In my opinion, there is no way that this stock is worth the price. If there is another fire, it's not going to be pretty.

November 06 2013 at 11:14 PM Report abuse rate up rate down Reply
1 reply to john.sodano's comment
Linda

There have been 2 fires and neither were the fault of the cars. The reason for the stock downturn is the shareholder want more cars made per day. TESLA is having problems getting the batteries they need to do this.

November 07 2013 at 1:18 AM Report abuse rate up rate down Reply
skygill

I meant the 1880's. Though come to think of it, it has always been manipulated.

November 06 2013 at 10:45 PM Report abuse rate up rate down Reply
skygill

Seems to me the stock market is being manipulated. Something like the 1980's. History repeating itself.

November 06 2013 at 10:43 PM Report abuse rate up rate down Reply
WILLS

The wise will watch not only profit, but revenue as there appears to be a contradiction between these two. A business can only cut so far to retain the former and must rely on sales and expansion for the latter.

November 06 2013 at 9:04 PM Report abuse rate up rate down Reply
vlady1000

Getting a little high for me, so I took some more off the table today. Profits have improved, for the most part, due to cutting expenses, not due to real growth.

November 06 2013 at 7:12 PM Report abuse rate up rate down Reply
TINKDAY

Dow is not up because we have a good economy,as most people know, it is up because all the money is going into the stock market, because the Fed's have made it the only game in town, but they are also creating massive debt with what they are doing. The federal government and every city, county and state government is raising taxes, fees ,tolls and adding new fees , taxes and tolls, so we know what will soon happen.

November 06 2013 at 5:33 PM Report abuse rate up rate down Reply
Bruce

The markets love Democratic victories. Business people KNOW who really keeps our economy functioning, and respond accordingly. One more mail in the Tea Party coffin...

November 06 2013 at 5:25 PM Report abuse +1 rate up rate down Reply
2 replies to Bruce's comment
spectrumprodec2

makes sense

November 06 2013 at 5:55 PM Report abuse rate up rate down Reply
betty_brock

Malarkey, Evan. You love the spin but it makes you dizzy.

November 06 2013 at 8:02 PM Report abuse -1 rate up rate down Reply
chuckhalper

Tesla. The last major full fledged auto maker to get in to the game, that survives today, was Chrysler, founded in 1924. Since then, scores of car companies have all gone out of business.Those who think Tesla can overcome the economy of scale, engineering and plant/tooling investment, distribution, and competitive challenges indigenous to the business, over the long run, might want to review the history( and mortality rate) of motorcar makers first. And if the argument is "well its a great product", so was the Packard in its day. IMO--If you are in it for the long term, dump that stock. If you're a day trader, hey, have fun.

November 06 2013 at 5:16 PM Report abuse +1 rate up rate down Reply
Keith

Keep buying us time so we can stock up for the big one! Are you guys ready? Less than 5 years left for prosperity in the U.S.

November 06 2013 at 5:11 PM Report abuse rate up rate down Reply