CE 100 Index Slips 2.3% as Tesla Shares Continue Skid

The 18% slide in Tesla shares this past week was symptomatic of some of the headwinds facing the Connected Economy stocks this past year.

Disruptive technology, yes. But there are worries, at least on Wall Street, over weakening demand, how macro pressures may come to bear on companies’ fortunes and what lies ahead in a new year.

Tesla, according to reports, has been offering $7,500 discounts on higher end electric vehicles, and has been offering credits in countries including Canada and Mexico. And, elsewhere, the company has also been offering 10,000 miles of free charging.

Earlier in the month, CEO Elon Musk sold 22 million shares in Tesla for $3.6 billion and said during a Twitter Spaces audio chat that a “serious recession” looms next year.

Tesla’s decline helped lead the CE 100 Index lower. The index slipped 2.3% in the penultimate week of the year, and stood 35.9% lower year to date with just a few days to make up some lost ground.

Work-related companies, which are vulnerable in a recession as enterprise clients pull back, were part of the worst performing pillar as the group shed 3.9% for the week.

WeWork gave up 16.3%, as The Wall Street Journal reported that the company is grappling with dwindling cash reserves, more expensive debt and declining demand for its co-working model.

CrowdStrike slipped 8.5% as BlackBerry, a cybersecurity peer, said in its earnings commentary that sales cycles were taking longer.

Consumer-facing names also took a drubbing. Peloton lost 17% in a week where data on consumer spending showed a slowdown in November, climbing just 0.1% from October’s levels. And data from the Personal Consumption Expenditures report show that spending on services is still growing, but spending on goods is slowing.

These losses helped swamp names that managed to finish the week in the black.

MUFG had a return of 20.9% this week, which helped leading the Banking pillar higher by 2.5%. As reported by Bloomberg, Japan’s biggest bank is eyeing buybacks.

Nike Bucks the Trend

Nike gained 9.8%. And as detailed in this space, Nike stock soared after showing strong results in its DTC strategy, reflected in earnings.

“Q2 was our biggest member demand quarter ever, and we saw double-digit growth in member engagement,” Nike CEO John Donahoe told analysts as the digital business was up 34%, which in turn helped the company log 17% revenue growth. As reported on the earnings call, Nike Direct, the brand’s straight-to-shopper businesses, grew 30% on a currency-neutral basis.

“Consumers want to get what they want when they want it and how they want it,” said Donahue on the call. “And consumers have told us they want a consistent, seamless, and premium experience, both digitally and physically. With a consumer base that comes directly to our apps, to our website, and to our owned and partner stores, we, alongside our partners, are in a position to control our own destiny.”

Nike’s sanguine outlook stands in stark contrast to some of the sentiment facing other CE 100 names — and investors may be longing to put 2022 fully behind them.