Global outbreak escalates U.S. stock collapse Tesla, Microsoft and other technology stocks into the worst-hit areas

The three major U.S. stock indexes fell more than 4 percent on February 27as as a result of the global outbreak, with the Nasdaq and the Standard and Poor’s 500 index posting their biggest one-day declines in eight-and-a-half years. By the close, the Dow was down 1,190.95 points, or 4.42 per cent, at 25,766.64, the Nasdaq was down 4.61 per cent at 8,566.48 and the Standard and Poor’s 500 index was down 4.42 per cent at 2,978.76.

Global outbreak escalates U.S. stock collapse Tesla, Microsoft and other technology stocks into the worst-hit areas

Among them, technology stocks were hit, with Tesla down 12.81 percent, Microsoft down 7.05 percent, Apple down 6.54 percent, Intel down 6.40 percent, Nvidia down 5.57 percent, Google 5.29 percent and Amazon down 4.81 percent.

Tesla’s market value evaporates $18.3 billion in capacity and sales affected

Overnight, Tesla lost $18.327 billion in market value. The impact of the outbreak on car companies such as Tesla is mainly reflected in both capacity and sales.

Tesla’s new car registrations in China fell 46 percent in January from the previous month,media reported, as the Lunar New Year holiday and the new coronavirus outbreak slowed the pace of car buyers. In January, Tesla registered 3,563 new cars in China, down from 6,643 in December, according to China AutoMotive Information.

Earlier, Tesla’s chief financial officer said on a conference call that the impact of the new coronavirus outbreak was delayed only a week and a half in China, and on February 13, Tesla reversed earlier claims that the outbreak would have a significant negative impact on its business.

Tesla’s share price has soared in the past month, falling to $679 on January 27 at $558.02 a share, and on February 19th, it reached a monthly high of $917.42.

Tesla’s fourth-quarter 2019 results show that as of January 2020, Tesla has more than 50 direct-run experience centers and showrooms in China, 30 service centers, 2,300 super charging piles and 2,100 destination charging piles, and by 2020, Tesla plans to have a 4,000-plus-plus in China. Super charging station.

CFRA analyst Garrett Nelson argues that Tesla is more concerned about the spread of the coronavirus than other automakers because it relies heavily on new plants in China.

As the outbreak gradually brought the outbreak under control, Tesla’s Shanghai super plant resumed production on February 10th, and domestic Model 3 production is back on track.

Tesla’s Shanghai Super plant was temporarily closed on January 30, delaying the resumption of work by about a week and a half until it officially resumed production on February 10. According to the head of the Tesla plant, to ensure the health of factory-to-staff workers during the outbreak, as well as the stability and safety of production, Tesla has taken scientific measures.

In addition to accelerating the resumption of production, Tesla Line stores on February 17 began to gradually resume operations, one after another to resume domestic Production Model 3 delivery.

“One brother of market capitalisation” Microsoft and Apple’s performance affected

On February 19th, as Microsoft’s share price rose and Apple’s share price fell, microsoft regained the number one title in the value of the U.S. technology company from Apple in March.

After the February 27 session, Microsoft released an update to its third-quarter earnings guidance for fiscal 2020, saying that Microsoft Windows OEM and Surface were more adversely affected by the supply chain recovery affected by the new crown outbreak than previously reported by the 2020Q2 call. Microsoft has previously announced that its systems software Windows and PC businesses are not expected to meet quarterly revenue targets of between $10.75 billion and $11.15 billion due to the outbreak.

Microsoft’s shares are now at a one-month low of $158.8 per share, down 15.6 percent from a monthly peak of $188.19.

In a recent interview, Satya Nadella, Microsoft’s chief executive, said the company’s success was defined by its economic impact, not its high market capitalisation: “If you just celebrate your market capitalisation, not the widespread success of people around the world, then I think it will be fleeting.” “

Similarly, Apple’s share price is on a downward trend, peaking on February 12 at $327.20 a share, which fell to $273.52 a share after yesterday’s close, wiping $83.7 billion off its market value. Apple CEO David Cook said on the same day that China is controlling the new coronavirus, new cases are declining every day, Apple factory is overcoming the outbreak to restart.

Morgan Stanley believes the impact of the current coronavirus outbreak is temporary and will not cause fundamental damage to the iPhone’s market demand, keeping Apple’s target price at $368.

However, according tomedia reports, Apple commissioned companies such as Foxconn Group in China and Sussu Technology to mass-produce new handsets each year, and Apple engineers would go to the local contract factory to communicate before mass production, and the cancellation of flights triggered by the new crown outbreak prevented technicians from communicating. Reuters said China’s coronavirus outbreak could delay Apple’s plan to launch the iPhone in September.

China general shares first rise and then fall first quarter results to be restored

At the close of trading on February 27th, Alibaba’s share price was $205.30 a share, after the outbreak, alibaba’s share price experienced a first-up and then-fall, with the highest in a month reaching $224.31 a share on February 12.

Alibaba said in a conference call after the February 13 earnings report that, affected by the outbreak of new crown pneumonia, do not rule out a relatively large slowdown in growth rates, Taobao, Tmall, local life services may also be negative income growth, recovery curve depends on how much time it will take to end the outbreak, If the outbreak lasts longer, it will take longer to recover.

Yesterday, in a conference call after the fourth-quarter results, NetEase CEO Ding Lei said the outbreak had a negative impact on NetEase: “The outbreak has had a negative impact on many industries, and so has NetEase.” First of all, because of the outbreak, many employees work from home, increasing our communication costs. The second is the advertising industry, online education and games affected by the outbreak is relatively small, many people also choose to take online classes at home. “

NetEase’s share stake also went through a first-up-and-later curve, with the monthly high at $356.78 per share on February 19, compared with $321.93.

Ping Duo and JD.com share stake trends are in line with the overall change in China’s shares. Among them, JD.com’s share price peaked at $42.95 a share on February 19 and is now down to $38.40 a share. Ping Duo Duo’s shares, which hit $37.43 a share on February 13 and rebounded after falling to $32.8 a share on February 25, are now trading at $35.18, up 1.88 per cent on the overall decline.

From the share price curve can be seen, in China’s worst outbreak, The Chinese stock does not fall back up, and when the epidemic spread to the world, China’s shares fell along with the broader market, reflecting the capital market during the outbreak period of China’s confidence in the control of the epidemic, as well as the global spread of the epidemic after the panic.