Index futures were mixed before Tuesday morning’s Producer Price Index (PPI) data was released and they remained mixed afterward. The S&P 500 and the Dow Jones industrials were both trading lower, while the Nasdaq was holding on to a small gain. Crude oil traded roughly flat at just under $82 a barrel, while Bitcoin continues its march to top Monday’s record high of nearly $68,500. Yields on 10-year Treasury notes were down by about three basis points before the opening bell.
Before getting to some moves among meme stocks, it’s worth noting the General Electric Co. (NYSE: GE) announced Tuesday morning that it plans to split into three different companies over the next few years. The company’s health care segment will be hived off in 2023, and the power segment is tentatively scheduled to be split off in 2024, leaving behind the aviation segment as its own company. Shares traded up by as much as 10% before the markets opened.
As for the meme stocks, there was one big loser on Tuesday morning. SmileDirectClub Inc. (NASDAQ: SDC) traded down more than 20% after reporting disappointing quarterly results after markets closed Monday. The maker of clear plastic dental alignment devices missed on both profits and revenues, blaming macroeconomic headwinds for the poor showing. In other words, straight teeth are not a priority when there is so much else for the company’s “core demographic” to buy.
At the other end of the spectrum, Australia-based Naked Brand Group Inc. (NASDAQ: NAKD) added about 30% to its share price in Tuesday’s premarket, following the company’s announcement that it is getting into the electric vehicle (EV) business. After markets closed Monday, Naked Brand said it would acquire all the stock in three entities that combined own Cenntro Automotive Group, “a commercial EV technology company with advanced market-validated commercial vehicles and autonomous driving technologies.” New Jersey-based Cenntro designs and manufactures commercial electric vans and says it had sold and delivered more than 3,300 vehicles in more than 26 countries as of last December.
OG meme stock AMC Entertainment Holdings Inc. (NYSE: AMC) added just over 8% to its share price Monday. The company reported third-quarter results after markets closed, and the stock was down about 5% in Tuesday’s premarket. While the company beat estimates for both the quarterly loss and higher revenue, the thinking is that retail investors might take their profits and move on. That seems unlikely, but there are sure to be lots of ups and downs in the stock price in the days ahead.
More than 32 million shares of Tesla Inc. (NASDAQ: TSLA) changed hands on Monday. The stock closed down about 4.8%, following the Twitter poll CEO Elon Musk posted asking followers whether he should sell 10% of his Tesla stock (57% said he should). What Musk managed to achieve with his poll was to call attention to the fact that he has to sell the stock by 2022 or risk losing it. That implies that those shares will soon be available on the open market, Musk’s tax issues notwithstanding.
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