Finimize - ⛏ Tesla's digging for gold

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Today's big stories

Tesla explored closer ties with mining giant Glencore in a bid to shore up vital mineral supplies
Here's why this year could soon get better for stocks – Read Now
China’s economy showed more signs of weakness last month

Digging For Blue Gold

What’s Going On Here?

Leading electric carmaker Tesla held talks with Swiss mining giant Glencore about taking ownership in the company, according to details out on Monday.

What Does This Mean?

Tesla’s already cemented a deal to buy cobalt – a key ingredient in EV batteries – from Glencore, but it looks like the OG electric carmaker was recently angling for a direct stake. That could’ve been a savvy move: a lot of the materials used to make EV batteries are found in less stable parts of the world, and this year’s war in Ukraine has shown us how quickly supply chains can be disrupted by geopolitical instability. Tesla, then, might have been looking to one of the world’s biggest mineral producers in a bid to further shore up supply. But it seems like Glencore’s coal mining activities – a blow against Tesla’s decarbonization goals – stopped any deal from getting over the line: Musk might be many things, but a hypocrite isn't one.

Why Should I Care?

Zooming in: Focus, Elon.
Tesla’s always been a bit of a one-man show, and shareholders are getting worried that the one man in question is more focused elsewhere: Twitter. So the news that Tesla was lining up a stake in Glencore will do little to calm those nerves. After all, Musk does nothing by halves, and a minority stake might have just been the beginning.

Zooming out: Two birds, one stone.
Extracting materials for EV batteries is dirty business, so buddying up to mining firms might seem like a seedy slant for Tesla’s image. But if Musk uses any potential involvement to push the ugly business in a less ugly direction, he could fix an ongoing supply chain problem and try to tidy up the industry’s image in one fell swoop.

You might also like: What investors are getting wrong about the EV market right now.

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Analyst Take

Five Things That Could Drive Stocks Higher This Year

By Luke Suddards, Analyst

In investing, you always want to look for opportunities where the upside potential looks bigger than the downside.

And at its current levels, the S&P 500 may be one of those – at least for the next few months.

So you’ll want to take a look at the five factors that are likely to drive the key US stock index higher between now and the end of the year.

That’s today’s Insight: the five things that could drive stocks higher for the rest of this year.

Read or listen to the Insight here

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