Week of 10/16-10/20 Stocks Slide, Tesla & Netflix Earnings, Treasury Yield Crosses 5%

Stocks continued to decline as tensions keep escalating in the middle east and oil prices remain at levels not seen since 2007. As different assets compete for capital, the 10-year Treasury yield reached over 5% and continues to make the news with its recent levels positioning the economy in a bad spot. This means investors are more likely to put their money away from stocks and the economy may continue to experience higher mortgage rates (+8%), credit cards, auto loans. etc. The technology sector tumbled this week as Tesla earnings resulted in a 15% decline for the stock. Elon Musk explained during the earnings conference call how macroeconomic issues continue to affect the company's profits. The commitment to the Cybertruck has hindered Tesla as production has been delayed multiple times and another 18 months are expected before it enters the positive cash flow territory for the company. Tesla stock closed on Friday at 212dlls per share. On the other hand, Netflix beat earning expectations by adding almost 9 million new subscriptions in the last quarter. Their recent ad plan membership grew 70% quarter over quarter and the company expects to increase prices to improve its profitability as well as to assist in coverage of higher production costs. The stock reacted well in the extended hours market session during the earnings call by surging almost close to 13% and finished the week at 390dlls per share.