Profits jump at Goldman Sachs, oil price cools for now and Tesla lays off workers

“After Friday’s Wall Street sell-off markets have regained some optimism despite escalating tensions in the Middle East,” says Danni Hewson, Head of Financial Analysis at AJ Bell.

“A strong performance by Goldman Sachs has helped calm sentiment further, switching the focus back to company performance and the current earnings season.

“Clear signs that the US investment banking sector is getting back on track came in the form of a 28% jump in profits as the bank benefitted from a surge in deal making that forms the backbone of its business. Shares jumped on the news and that gave investors the best kind of surprise in the form of an expectation beat which set the tone for the day.

“It didn’t hurt a bit that the oil price, which many had expected to surge following the weekend’s news of an Iranian drone strike on Israel, actually drifted lower. Investors can’t know how diplomatic efforts will be met and there is the risk that today was merely a temporary reset after markets pre-priced in a retaliatory strike.

“London markets tracked higher for a time as the FTSE 100 continued to flirt with a record high that has so far failed to materialise. It could be that the pending deluge of economic data could provide the boost needed to scale that mountain, but the latest UK jobs and inflation data could just as easily land like a wet soufflé.

“There may be green shoots both in the UK and the US but there is also plenty for investors to worry over. PageGroup’s announcement of jobs cuts hints of trouble to come in the UK jobs sector whilst Tesla has been trying to plug the leak in its finances for months.”

Tesla

“Elon Musk’s EV company has lost momentum and lost the edge it wielded when it was the only real competitor on the field.

“Slashing the price of its vehicles has only gone so far in dealing with cooling demand and it’s going to have to work harder and smarter to regain investor confidence. Promised ‘low cost’ models have failed to materialise and its much-hyped cyber truck is suffering from unexpected delays.

“The momentum for motorists to make the switch has been lost and there are still big issues with infrastructure and price. Until those concerns are successfully dealt with Tesla is likely to remain under pressure.”

These articles are for information purposes only and are not a personal recommendation or advice.