Twitter, Shell, the Chinese Car Industry, and Cannabis Companies: Weekly Digest (3 October–7 October)
This week, our attention was focused on such companies as Twitter, Tilray, Canopy Growth, Aurora Cannabis, Li Auto, Xpeng, NIO, and Shell. Check out the news about these companies.
Elon Musk and Twitter: the deal is back on
On Tuesday 4 October, we learned that Elon Musk had decided to get back to buying the popular social network Twitter for $44 billion. The parties confirmed that the dialogue had started again. This news sent the shares of Twitter Inc. (NYSE: TWTR) surging 22.24% to $52.
As you know, in April 2022, Elon Musk announced his intention of acquiring Twitter for $44 billion, or $54.2 per share. However, in July, the billionaire gave up the trade, and the company owning the network went to law.
On 6 October, the Delaware State Judge suspended the trial and announced that if the trade was not closed by 5 pm on 28 October, she would fix a new hearing date.
Cannabis companies’ stock grew abruptly
On Thursday 6 October, Joe Biden announced that he would pardon several thousand people convicted of the procession of marijuana.
Moreover, Joe Biden promised to address the attorney general, Merrick Garland, and the Department of Health and Human Services to revise the classification of marijuana on the list of drugs and exclude it from List 1.
This news sent the stocks of cannabis makers surging: on the same day, the share price of Tilray Inc. (NASDAQ: TLRY) skyrocketed 30.87% to $3.9; the share price of Canopy Growth Corp. (NASDAQ: CGC) rose 22.15% to $3.75, and of Aurora Cannabis Inc. (NASDAQ: ACB) went up 7.26% to $1.33.
Stocks of Chinese electric car manufacturers plummeted
The stocks of Chinese manufacturers of electric cars recorded a serious drop this week. Since Monday, the quotes of Life Auto Inc. (NASDAQ: LI) plummeted 8.95% to $20.95, the quotes of Xpeng Inc. (NYSE: XPEV) dropped by 11.63% to $10.56, and NIO Inc. (NYSE: NIO) slid 6.34% to $14.77.
Due to accessory supply issues caused by the COVID-19 pandemic, not all Chinese car manufacturers that specialise in green transport managed to live up to the forecasts in Q3.
The disappointing supply statistics for new electric cars made investors lose confidence in the sector. On 6 October, the Japanese investment bank Mizuho decreased the target price of NIO shares from $42 to $40.
Shell decreased its forecast for Q3
On Thursday, the British-Dutch oil and gas giant Shell warned investors of an expected decline in its third-quarter earnings due to weaker gas trading and a falling margin in the oil sector.
The decrease in trade volumes in the gas sector is explained by seasonal factors in addition to a serious difference between the planned statistics and the real results. Shell forecasts gas production in July-September to be 890,000-940,000 barrels in oil equivalent per day; as for liquefied natural gas, production will reach 6.9-7.5 million tons per day.
Moreover, Shell expects the margin from oil processing to drop from $28 per barrel to $15 at the end of the quarter, and the margin of the oil and chemical department to plummet from $86 per ton to as low as $27. As you remember, Shell will present its financial report for Q3 on 27 October.
After the updated forecast was issued, the stock quotes of Shell PLC (NYSE: SHEL) dropped by 4.35% to $51.67.
At the beginning of the week, Twitter stock grew by 22%. Elon Musk might still buy the social network. The trial between the billionaire and Twitter Inc. is suspended: the parties now have a chance to finalise the trade until 28 October.
Joe Biden announced that he was ready to grant pardon to the convicted for marijuana processing, and change the classification of marijuana on the list of drugs. The stocks of cannabis makers are growing as a result.
This week, the quotes of such Chinese electric car manufacturers as Li Auto Inc., Xpeng Inc., and NIO Inc. recorded a decline.
Oil and gas company Shell warned investors of a decreasing forecast for Q3, which made its shares react with a decline.