Few industries had more tariff-related roadblocks put in their paths than the automobile sector. But you wouldn’t know it by looking at auto stocks. They’re all cruising since the “Liberation Day” lows!
Take a look at the MoneyShow Chart of the Day. It shows how shares of major US-based and foreign-based auto makers have performed since early April. They’ve surged anywhere from 25.2% – for Honda Motor Co. (HMC) – to 102.4% -- for Tesla Inc. (TSLA). The “Big Three” are up 37%, 45.9%, and 58.2%!
Auto Stocks Cruising to New Highs
Data by YCharts
How can that be? Just look at their recent earnings reports. Domestic sales were relatively healthy at General Motors Co. (GM), Ford Motor Co. (F), and Stellantis NV (STLA). Environmental regulations are being eased, saving car and truck makers billions of dollars. Plus, the Trump Administration has watered down some of its tariffs on autos and auto parts – and industry players have responded by lowering their tariff cost estimates.
Yes, subprime auto loan delinquency rates remain very high. And yes, a handful of lenders to car buyers with weak credit have gone bankrupt.
But again, the trading action in auto stocks speaks volumes about what investors think: The industry has plenty of pothole-free road ahead. If you’re looking for stocks in an uptrend to trade, auto names may be worth targeting.
