Daily Dispatch: Elon Musk confirms he’ll step back from politics, donations

Wednesday, 21 May 2025

Affluent, liberal would-be Tesla buyers have been turned off the brand in droves by Musk’s political affiliation with Donald Trump.

Market Summary

US markets are down on Tuesday afternoon trading in New York ‒ the S&P 500 is down 0.70%, the Nasdaq has fallen 0.72% and the Dow Jones has retreated 0.60%. Tech stocks are leading markets down.

Bill Northey, investment director at US Bank Wealth Management, told CNBC US investors were stuck in a state of “optimism without clarity” over the progress of tariff talks between the US and other countries.

The Trump effect however did work well for solar stocks, which were up on news the US President had said construction on a New York offshore wind farm could resume, reversing an earlier order to stop the project. It’s the first offshore wind project to bring electricity straight to New York City.

The European markets were up across the board Tuesday, while in Asia most gained after China cut its key lending rates by 10 basis points to boost its economy.

Hong Kong’s Hang Seng index rose 1.49%, China’s CSI 300 added 0.57%, Japan’s Nikkei gained 0.08% and South Korea’s Kospi was flat.

Tower reported a positive full year profit; it had insured fewer flood-prone homes.

New Zealand’s S&P/NZX50 ticked up 0.12% by the end of play Tuesday, although it spent most of the day retreating. Listed insurer Tower reported a positive result during the day.

Gainers rose modestly. Leading these was Vector, up 3.91%; the company said last week it was undertaking a strategic review of its fibre business.

Pacific Edge gained 3.66%, Meridian Energy rose 3.41% while Spark gained 2.97% after The Australian’s Dataroom market gossip column reported at least two private equity firms are “going over” Spark as they “ponder a buyout proposal”.

Burger Fuel Group rose 2.86%.

In decliners, Being AI slumped 34.53% ‒ and the stock price has dropped almost 90% over the year ‒ after an announcement on Friday in which the company said it was shutting down Project Treehouse, its artificial intelligence initiative. Relatedly, BAI Group chief executive David McDonald and chief technology officer Nicolas Fourrier and two others had resigned.

The Tesla community was not thrilled by Musk’s increasingly large role in Donald Trump’s administration.

Travel software Serko fell 7.84% after profits widened in the full year. Blis Technology dropped 6.67% and Restaurant Brands fell 3.90%.

Australia’s central bank cut its policy rate to 3.85%, its lowest level since May 2023, on Tuesday and the S&P/ASX200 responded by closing up 0.58%. Top gainers were enterprise software firm Technology One, which gained 11.33% after strong half year results. Clarity Pharmaceuticals advanced 5.05% on hopes of positive clinical trials.

While we slept

Elon Musk told an audience at the Qatar Economic Forum he planned to run Tesla for at least another five more years, but would be pulling back on politics, and claimed he would no longer fund political campaigns after he had “done enough”.

In the 2024 Presidential election, Musk openly donated millions of dollars to the Trump campaign and had been silently sending large sums to Republican Super PACs prior to that, rubbing the average largely affluent, liberal Tesla up the wrong way and causing Teslas to plummet in popularity.

Bloomberg is reporting Hong Kong’s pension fund managers are sounding the alarm about possibly having to sell their US treasuries, as the country’s system are only allowed to invest over 10% of their assets in them if the US has an AAA rating, which they no longer have after Moody’s cut the rating last week.

Their bonds and mixed asset funds that could have US treasuries exposure stood at HK$484 billion (NZ$104.5b) by the end of 2024, Bloomberg reported.

And Pfizer and Moderna, which make the most widely used COVID-19 vaccines, are assessing their options after the Trump administration decided annual COVID-19 shots for healthy younger adults and children will no longer be routinely approved under a major new policy shift unveiled overnight.

What’s up today

A swag of results will be out Wednesday ‒ Napier Port, Argosy, Radius and PaySauce, while Vista Group holds its AGM.

The RBNZ will be publishing their first inaugural business expectations survey, after having asked several hundred businesses around the country their expectations about inflation that feed into their price- and wage-setting decisions.

In The Post, Tom Pullar-Strecker dissects the Government response to a Transpower statement about possible power shortages from 2026; Rob Stock writes about business expectations in the lead up to the Budget, and farming commentator Craig Hickman suggests Foodstuffs could learn a thing or two from Fonterra.