EU and US could reach trade deal this weekend - Reuters
Investing.com - A fight between billionaire Elon Musk and U.S. President Donald Trump over a massive tax-and-spending bill devolved on Thursday into an online sparring match over who deserved credit for Trump’s election win, with the two later trading threats on their respective social media platforms.
Trump in particular suggested that he could cut off billions of dollars worth of subsidies to Musk’s businesses, sending shares in Tesla (NASDAQ:TSLA) -- which is helmed by Musk -- down by more than 14%. The sell-off wiped some $150 billion in market value off the stock, while Musk’s personal net worth plummeted by about $27 billion to $388 billion, according to Forbes data cited by Reuters.
In response, Musk wrote about possibly creating a new political party, hinted at Trump’s inclusion in government documents linked to late sexual offender and financier Jeffrey Epstein, and seemed to support an impeachment of the president.
However, indications were emerging of a potential de-escalation in the feud on Friday, with the president telling Politico that the relationship is "okay" and "going very well, never done better".
Meanwhile, White House aides are planning for the two to hold a call in a bid to forge a detente in the spat, Politico reported.
Here’s a look at how Wall Street is reacting to Musk and Trump’s falling out:
"The quickly deteriorating friendship and now ’major beef’ between Musk and Trump is jaw dropping and a shock to the market and putting major fear for Tesla investors on what is ahead." - Wedbush
"While emotions are running high, we are not convinced the longer-term vectors that drive [Tesla]’s value have changed here. AI leadership, autonomy/robotics, manufacturing, supply chain re-architecture, renewable power, critical infrastructure [...] Tesla still holds so many valuable cards that are largely apolitical, in our opinion." - Morgan Stanley (NYSE:MS)
"[W]e believe that [Tesla]’s sell-off yesterday amid the Elon/Trump social media exchange likely preempted a down move; albeit we believe negative near-term fundamentals may not be fully contemplated in the stock." - Barclays (LON:BARC)
"With CEO Elon Musk and President Trump publicly falling out, we believe the political calculus on renewables and electric vehicle support has shifted modestly which could result in extended timing on renewables safe-harbor provisions as Congressional leaders assess mid-term risk post Trump/Musk split." - Oppenheimer