WSJ What’s News - What’s News in Markets: Tesla Sales, Drinks Warning, Steel Block

Episode Date: January 4, 2025

Why did Tesla hit record sales last quarter but still see vehicle deliveries decline for the year? And how did the U.S. surgeon general’s call for cancer warnings on alcoholic drinks affect beverage stocks? Plus, what’s next for U.S. Steel after President Biden blocked its sale to Nippon Steel? Host Francesca Fontana discusses the biggest stock moves of the week and the news that drove them. Sign up for the WSJ's free Markets A.M. newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

Hey, listeners. It's Saturday, January 4th. I'm Francesca Fontana for The Wall Street Journal, and this is What's News in Markets, our look at the biggest stock moves of the week and the news that drove them. Let's get to it. Hey, everybody. Happy New Year. Hope each of you had a good end to your 2024 and that your 2025 is off to a good start. 2024 was a great year for the stock market, capping the best two year period in a quarter century. But the new year started off pretty gloomy. We saw the indexes go on a losing streak this week as we wrapped up December and kicked off January. Investors are warning that valuations are high and they're adjusting their

expectations for the Federal Reserve this year. Namely, it seems that the Fed is growing more reluctant to cut interest rates as the U.S. economy remains on solid footing. But things seem to turn around on Friday thanks to good old tech and chip stocks. The Dow snapped its four trading day losing streak, remember no trading on New Year's Day, adding about 0.8 percent. The S&P 500 rose more than 1 percent and the Nasdaq gained almost 2 percent, with those two snapping five trading day losing

streaks. On a weekly basis, the Dow fell 0.6 percent, while the S&P and Nasdaq each fell about half a percent. Tesla, the Elon Musk-led electric carmaker, said that its annual vehicle deliveries fell in 2024 for the first time in more than a decade. Despite selling a record number of cars in the fourth quarter, the company still fell short of the some 500,000 cars it needed to sell in order to beat last year's annual performance. Got some more numbers for ya. For all of 2024, Tesla delivered 1.79 million vehicles worldwide, which is down about 1% from a year earlier. Meanwhile, Chinese rival BYD is gaining on Tesla. Earlier in the week, BYD said it logged about 1.76 million sales for 2024.

Tesla shares dropped 6.1% on Thursday, gaining back some of that ground on Friday. Looking at the stock from the closing price on December 24th through Friday's close, Tesla has lost in all about 11%. Investors in big beer and spirits companies had something of a bad hangover after the U.S. Surgeon General called for cancer warnings on alcoholic beverages. In his advisory issued on Friday, Dr. Vivek Murthy said the drink should carry warnings to increase awareness that alcohol consumption is the third leading preventable cause of cancer in the U.S. after tobacco and obesity.

Americans have been drinking less alcohol due to health concerns and changing tastes, which alcohol companies say has dented their revenue streams. So let's see how some of these stocks did. Like Anheuser-Busch InBev, the Budweiser maker, its US traded shares lost about 2% Friday. And US traded shares of Diageo, the British company known for its whiskey brands as well as Guinness, Smirnoff, and Captain Morgan, fell about 3.8%. Now last but not least, let's talk about U.S. Steel, the company that's exactly what it sounds like, the third largest steelmaker in the U.S.

President Biden has kept his pledge to keep U.S. steel domestically owned. On Friday, Biden blocked its $14.1 billion sale to Japan's Nippon Steel, which is the world's fourth largest steelmaker. Nippon Steel had pursued U.S. Steel as a way to enter the American market, where tariffs have been helping keep prices higher than they are in other parts of the world. This move by Biden came after a months-long review by the Committee on Foreign Investment in the United States, and it's a victory for the United Steelworkers Union, whose leaders have long opposed the deal. The order also makes the future of U.S. Steel more foggy. Executives have said they might close plants and shift

production to lower-cost facilities if the sale to Nippon Steel didn't go through. U.S. Steel shares dropped about six and a half percent on Friday and notched a weekly loss of about four and a half percent. And now you know what's news in markets this week. You can read about more stocks that moved on the week's news in The Score, my column in the Wall Street Journal's Exchange section. Today's show was produced by Anthony Fancy with supervising producer Michael Kosmitis. I'm Francesca Fontana. Have a great weekend and see you next Saturday.