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Ongoing concerns about the health of the global economy sent stocks tumbling on Tuesday, accelerating the downward pressure that has marked most of the past few weeks. With consumer and technology stocks among the worst performers, the Nasdaq led the decline, falling almost 4% and reaching its lowest close of 2022.
Electric vehicle stocks played into the selling spree. This included a double-digit percentage loss by Tesla (TSLA), as well as substantial weakness in names like Rivian (RIVN), Faraday Future Intelligent Electric Inc. (FFIE) and Lucid Group (LCID).
Among the other standout losers, Universal Health Services (NYSE:UHS) dropped on a poorly received earnings report. At the same time, Protagonist Therapeutics (PTGX) lost half its value after the release of clinical trial data, falling to a new 52-week low.
Despite the overall weakness, some stocks managed to push higher. Magnachip (MX) jumped almost 20% on takeover chatter. Meanwhile, earnings news allowed NexPoint Residential (NXRT) to set a new 52-week high.
Sector In Focus
The EV sector suffered fierce selling pressure, with industry leader Tesla (TSLA) plunging by more than 12%. Shares of the Elon Musk-run company dropped amid a general market sell-off, which concentrated on consumer and technology stocks, as well as reports of regulatory barriers in India.
According to Reuters, India’s transport minister said that TSLA could not import cars from China to sell on the local market. However, the government official left open the possibility that the EV maker could manufacture vehicles in India for export.
Outside of TSLA, rival Rivian (RIVN) also staged a notable retreat. The stock dropped almost 10% after Barclays cut its price target on the stock. In making the decision, the firm pointed to valuation and risks to its production ramp.
Elsewhere in the sector, Faraday Future Intelligent Electric Inc. (FFIE) dropped almost 13%, while Lucid Group (LCID) retreated almost 9%.
Magnachip (MX) received a boost from takeover chatter, with the prospect of a potential deal sparking a nearly 17% rise in shares of the semiconductor manufacturer.
According to a report in Korea Economic Daily, South Korea’s LX Group has shown interest in acquiring MX. The firm is expected to deliver a letter of intent as early as next week.
MX advanced $2.46 to finish at $17.51. Shares are coming off a 52-week low of $14.66 reached early last week.
With COVID-related hiccups hurting its financial figures, Universal Health Services (UHS) endured intense selling pressure in the wake of its quarterly results. Shares plummeted almost 10%.
The provider of hospital and healthcare services reported a quarterly profit that came in well short of the amount predicted by analysts. The company said that COVID created staffing shortages, leading to higher pay for temporary workers.
The earnings news sparked a $13.30 drop in UHS, with the stock closing at $125.32. This added to a fall that occurred late last week, when weak results from HCA dragged down the entire hospital sector.
The stock has fallen 19% since last Wednesday’s close, marking its lowest finish since late December.
Notable New High
NexPoint Residential (NXRT) received a lift from the release of its latest earnings figures. Bolstered by the results, shares climbed 4% to reach a fresh 52-week high.
The Dallas-based real estate investment trust, which focuses on multi-family properties located in the Sun Belt, reported a bottom-line figure that topped analysts’ expectations. Meanwhile, the firm raised its full-year forecast.
NXRT finished the day at $93.29, an advance of $3.73. Shares also reached an intraday 52-week high of $93.85. The stock has pushed steadily higher over the past year, rising nearly 86% since the same period last year.
Notable New Low
The release of clinical trial data prompted a massive sell-off in shares of Protagonist Therapeutics (PTGX). The stock cratered 50% to reach a new 52-week low.
The company released information from a Phase 2 study of its PN-943 product. The trial tested the drug in patients with ulcerative colitis, an inflammatory bowel disease that causes ulcers in the digestive tract.
Two doses of PN-943 were tested — one failed to meet the main goal of the trial.
Dragged down by the data release, PTGX dropped $9.39 to close at $9.41. During the session, the stock also reached an intraday 52-week low of $8.82.
Shares had reached a 52-week high of $50.54 in the second half of 2021. PTGX has lost about 70% of its value over the past six months.
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Hot Stocks: TSLA, EV stocks fall; UHS drops on earnings; PTGX plunges 50%; MX, NXRT rise – Seeking Alpha
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