Hello Seven Lakers,

here's what you need to know for November 8th

TODAY’S BIG STORIES

1/ Tesla's stock up 3% ahead of the launch of an affordable car in Germany

2/ Oil stocks performing well on top of higher oil prices

1/ Tesla up 3% with €25,000 car launch

What’s Going On Here?

• Tesla (TSLA:US) shares were seen trading higher in early Monday trade after a report that the electric vehicle company is planning to manufacture a new electric vehicle model with an expected price of €25,000 ($26,863) at its factory near Berlin.

• Tesla stock rose 3% on the news.

What Does This Mean?

• Tesla is slowing entering the mass market in Europe, as infrastructure sustaining electric vehicles is becoming stronger and stronger

• Currently, Tesla's least expensive car in Germany is the Model 3, which starts at €42,990

Why Should I Care?

Bigger picture

• The steep price tag of electric cars - compounded by high interest rates - is one of several factors holding back uptake of the technology in Europe and the United States

• The average retail price of an EV in Europe in the first half of 2023 was over 65,000 euros, according to autos research firm JATO Dynamics, compared to just over 31,000 euros in China.

• This is a big step towards mainstream affordability of electric cars for a greener future

For markets

• Expanding into the mass market is critical to meeting Tesla's aim of increasing vehicle deliveries to 20 million by 2030

• This sets Tesla apart from competitors like Volkswagen (VOWG_p.DE) who have shied away from setting delivery targets and instead focused their strategies on protecting profit margins in the transition to EVs

• Considering how investors appreciated Tesla move (+3% stock price), some automotive competitors might follow with similar plans

Political trading

• Congressman Mike Garcia was selling Tesla shares over the summer

• Several other Congress members, including Sheldon Whitehouse, Josh Gottheimer, Ro Khanna, and Michael Guest, were also trading shares this year

2/ Oil stocks performing well and Rep. McCaul is making $$$

What’s Going On Here?

• Shell PLC (SHEL:US) and ConocoPhillips (COP:US) both reported their quarterly earnings this week

• The companies reported a strong quarter and their shares both traded positive during the day

What Does This Mean?

• Both companies reported profits down vs. last year, but the market was willing to ignore lower profits compared to same quarter last year

• Investors appreciated the strong revenue performance in a tough macro environment; this was supported by higher oil prices

Why Should I Care?

Bigger picture

• The oil market is currently under scrutiny due to the conflict between Hamas and Israel

• Rising oil can cause higher gasoline prices and complicate the Federal Reserve's fight against inflation

For markets

• UBS predicts oil prices to fluctuate between $90 and $100 per barrel, with potential spikes if Iranian oil exports decrease

• Sustained high prices are however unlikely, as Israeli-Palestine-Lebanon area is not a large oil producing region

• Impact in the medium term is possible is Iran gets involved in the war and US administration starts enforcing sanctions on Iranian oil exports more tightly

Political trading

• Congressman Michael McCaul’s switched from Chevron Corp (CVX:US) to Shell and ConocoPhillips and made perfect trades

• Since the start of 2022, he has sold $559,000 to $1,510,000 worth of Chevron stock, saving him -13% of losses: McCaul’s timely exit has certainly saved him a lot of money

• After selling his Chevron stocks, he immediately switched to Shell and ConocoPhillips.

• He has accumulated a massive $862,000 to $2,230,000 worth of ConocoPhillips stock so far this year and did +21% return

• Similarly, he has also bought $200,000 - $400,000 worth of Shell stock this year and did +10% return

How to be notified when politicians buy / sell stocks

As seen before, some suspicious trades were made by Congress Members and their relatives

However, the GOOD NEWS is that their moves can be copied (politicians need to disclose their stock positions)

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