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Tesla falls sharply after Musk and Trump feud gets nasty

The souring of their relationship will likely have a real impact for Tesla’s bottom line, given how much of the company’s business is related to federal credits.

J. Edward Moreno

Tesla is down by double digits after CEO Elon Musk and President Trump had a very public falling out that started off as a budget dispute and escalated to a threat to pull the entrepreneur’s government contracts, marking what appears to be the end of a relationship between the leader of the free world and the world’s richest man.

Musk took issue with the government spending bill the president backed, which the entrepreneur said would add to the government’s debt and undercut the mission he was given to help reduce government spending. The bill also axes the federal EV tax credit for customers, which could dampen demand for Tesla and jeopardizes its revenue from selling regulatory credits, without which Tesla would have posted a loss last quarter.

On Thursday in the Oval Office, Trump responded by saying he’s “very disappointed in Elon.”

“I’ve helped Elon a lot,” he said.

That’s when Tesla began to slip. As the spat escalated, it started to bringing other Trump trades down with it. So far, the dispute has destroyed well over a hundred billion dollars in market value for Tesla alone.

Musk spent a small fortune of his personal wealth getting Trump elected. He responded on X that without him, “Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate.”

Then the gloves came off.

Musk, 54, later (ominously) pointed out that Trump, 78, has 3.5 years left as president “but I will be around for 40+ years…”

Then Trump hit him where it hurts. On Truth Social, Trump said the easiest way to save money in the bill would be to cut the many government contracts and subsidies that Musk’s businesses benefit from. In addition to the EV tax credits that have made Teslas more affordable for some, SpaceX counts the US government as one of its largest customers. Musk then alleged that Trump is in the Epstein files.

After Trump was elected, Tesla shares rose as investors banked that Musk’s cozy relationship with the president would benefit the company. But without that relationship, what’s left are policies that mostly hurt Tesla, like tariffs and cutting the EV tax credit. In fact, analysts at JPMorgan estimated the budget bill alone would cut Tesla’s profits in half.

What a ride. At first, Tesla’s relationship with the president was great for the stock. Then the company realized Democrats buy cars, too, and Europeans and other foreign markets didn’t like his political stances. Now, the breakup is hurting.

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Luke Kawa

GameStop jumps in after-hours trading after CEO Ryan Cohen purchases another 500,000 shares

Ryan Cohen is putting his money where his mouth is.

The GameStop CEO bought another 500,000 shares of company stock for $10.8 million on Wednesday, per a filing.

The stock was trading higher on Wednesday thanks to Cohen’s purchase of 500,000 shares for roughly $10.6 million on Tuesday, and extended these gains in the after-hours session on this news.

“The Reporting Person believes that it is essential for the Chief Executive Officer of any public company to purchase shares of such company in the open market with his or her own personal funds in order to further strengthen alignment with stockholders,” per the filing. “The Reporting Person believes that any Chief Executive Officer who fails to do so should be fired.”

Cohen is poised to become even more financially enmeshed with GameStop’s stock and operating performance should shareholders approve a package that would tie his pay completely to ambitious targets for the company’s earnings and market cap.

The CEO now owns about 8.56% of shares outstanding.

markets
Luke Kawa

AppLovin tumbles; company dismisses negative report as “false, misleading, and nonsensical”

AppLovin managed to finish Tuesday well off its lows after initially getting clobbered in the wake of an incendiary report published by CapitalWatch.

Nonetheless, shares are getting torched on Wednesday, ending down nearly 6%. An AppLovin spokesperson forcefully denied the allegations made by CapitalWatch, which included calling the ad tech firm “the ultimate monument to 21st-century new-type transnational financial crime.”

Per an emailed statement:

“We categorically reject the claims made in this report, which is rife with false, misleading, and nonsensical allegations. AppLovin’s public filings transparently disclose our material investments, global operations, and information regarding significant shareholders.”

“Claims that AppLovin facilitated money laundering or its products are used for unauthorized downloads are patently false. AppLovin functions within a broader ecosystem that includes major app stores, operating systems, and payment providers, and the apps monetized through our platform must be publicly available on the major app stores and subject to their independent review and enforcement. Economically, the money laundering theory is implausible: publishers receive only a portion of advertiser spend, meaning any attempt to ‘launder’ funds would require forfeiting a substantial share while creating a highly visible, auditable transaction trail across multiple independent companies. Accepting the report’s premise would therefore imply a systemic failure across the broader mobile advertising and app-store ecosystem, for which the report provides no evidence.”

AppLovin craters after report from CapitalWatch alleges it’s a money-laundering operation for “transnational criminal kingpins”

Nonetheless, shares are getting torched on Wednesday, ending down nearly 6%. An AppLovin spokesperson forcefully denied the allegations made by CapitalWatch, which included calling the ad tech firm “the ultimate monument to 21st-century new-type transnational financial crime.”

Per an emailed statement:

“We categorically reject the claims made in this report, which is rife with false, misleading, and nonsensical allegations. AppLovin’s public filings transparently disclose our material investments, global operations, and information regarding significant shareholders.”

“Claims that AppLovin facilitated money laundering or its products are used for unauthorized downloads are patently false. AppLovin functions within a broader ecosystem that includes major app stores, operating systems, and payment providers, and the apps monetized through our platform must be publicly available on the major app stores and subject to their independent review and enforcement. Economically, the money laundering theory is implausible: publishers receive only a portion of advertiser spend, meaning any attempt to ‘launder’ funds would require forfeiting a substantial share while creating a highly visible, auditable transaction trail across multiple independent companies. Accepting the report’s premise would therefore imply a systemic failure across the broader mobile advertising and app-store ecosystem, for which the report provides no evidence.”

Tasha Matsumoto, Nate Becker
12h
Stocks jump as Trump walks back European tariff threats

All sector ETFs traded higher in the broad-based rally.

Benny, the mascot for the Chicago Bulls, performs during a break between the Bulls and the New Orleans Pelicans at the United Center on January 14, 2017 in Chicago, Illinois.
markets
Matt Phillips

Intel soars amid retail engagement, analyst chatter

Intel ripped toward a new 52-week high Wednesday, amid a flurry of activity in the options market and a couple of positive analyst assessments ahead of its earnings report due tomorrow.

Shortly after 11 a.m. ET, call options activity was roughly equivalent to the full-day average over the past 10 sessions. Bets on stock swings using call options have become a highly popular retail trade, suggesting that retail investors are getting interested in the shares ahead of the report from the partially nationalized American chip icon.

(That interpretation is buttressed by what we’re seeing on social sentiment-monitoring sites like SwaggyStocks, which at about 11:30 a.m. listed Intel as the fifth-most-mentioned stock on Reddit’s r/WallStreetBets forum over the past 24 hours.)

Wall Street analysts are also chattering about the stock, with RBC and Bernstein Research both writing about it in the last 24 hours.

RBC — which has a “sector perform” (or neutral) rating on Intel — said it expects a “slight beat and largely inline outlook” when the company reports after the close Thursday.

Bernstein’s Intel watchers — who have a “market perform” (also neutral) rating on the stock — seemed a bit more cautious, writing, “Overall numbers going forward still looking high to us. Fundamentals and valuation keep us sidelined.”

“If there is no memory, there’s no AI.”

FLASH FORWARD

ByMattPhillips

WedJan 212026

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