Good morning investors! The first trading day of the year started on a mixed note with the Magnificent 7 losing a large chunk of value and Bitcoin hitting new highs.

Today we cover:

• Tesla reports good sales. 🚘

• A look at the latest happenings in the crypto world. 🌍

• How to manage finances to buy a house. 🏠

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📊 Economy and News 

Some highs and some lows

December proved to be a bad month as the S&P Global US Manufacturing PMI experienced a consecutive second month of contraction. Output declined at its fastest pace in six months, exacerbated by a more pronounced decrease in the recent order book.

On the other hand, US construction spending reported a jump in November yet failing to meet Wall Street’s expectations by 0.20%. Construction spending rose 0.4% month-on-month in November to a seasonally adjusted annual rate of $2.05 billion. This was the eleventh month in a row that construction spending saw an uprise trend.

Global hits:

• Ticket sold in Michigan wins estimated $842.2 million Powerball jackpot in New Year’s Day drawing.

• Maersk halts Red Sea shipping until further notice after Houthi militant attack.

• ASML halts hi-tech chip-making exports to China reportedly after US request.

📈 Stocks

S&P 500 4,742.83 (-0.57%)
DJIA 37,715.04 (+0.068%)
NASDAQ 16,543.94 (-1.68%)
BRENT CRUDE 75.83 (-0.08%)
* Prices as of Jan 3rd, 12:20 AM UTC

Tesla Posts Reports Sales

Tesla reported record quarterly sales in the final three months of last year. The company sold 484,507 vehicles in the fourth quarter (globally), slightly higher than expected. Moreover, the number is 20% higher than the figures reported last year in the same quarter.

But it wasn’t the best: Tesla did great numbers but one competitor is doing even better. Chinese company BYD sold 525,409 battery electric vehicles in the three-month period to December 31. In comparison, Tesla sold fewer cars.

The company, however, stayed ahead of BYD in total full-year sales. BYD caters to the Asian and European markets and is not yet available in the US.

Is there a problem? The growth rate is nowhere close to the 50% target set by the company. Furthermore, it is down from the higher growth rate earlier this year that gave it a 38% gain for the year.

Furthermore, the company faces several other challenges, including the loss of tax credits. For example, some of its Model 3’s, have lost the full $7,500 federal tax credit. This makes cars more expensive for people. Plus, the company is facing competition from other manufacturers.

The overall situation: Overall, the company did pretty well in 2023.

“This was a clear win for Musk and Tesla as hitting 1.8 million vehicles for 2023 was a major achievement in a choppy macro for EVs,” said Dan Ives, an analyst with Wedbush Securities.

The industry in general is expected to face some challenges in 2024 despite analysts seeing a higher demand for EVs. Other EV makers are scaling down on ambitious plans and some are reporting disappointing quarters, including Rivian, which fell on declining fourth-quarter EV deliveries.

Just in: Dish Network rejoins EchoStar as it tries to compete in 5G.

Exciting news: Analysts see the S&P 500 earnings increasing 11.1% in 2024 despite rising just 3.1% in 2023.

🔐 Crypto

Bitcoin $45,257 (-0.23%)
Ethereum $2,368 (-0.01%)
Total market cap $1.74 (-0.01%)
* Prices as of Jan 3rd, 12:20 AM UTC

A look at crypto

Here are the latest happenings:

• Ripple price eyes 10% surge as legal expert cautions on the disposition of XRP assets.

• Jim Cramer says Bitcoin is here to stay.

• Grayscale’s latest spot Bitcoin ETF amendment omits authorized participants.

• China experiencing increased crypto-related corruption, bribery cases.

• Bitcoin climbs above $45,000 to a 21-month peak as the new year kicks off.

💵 Personal Finance

It’s getting harder and harder to buy a house, here’s how to improve your chances

The US homeownership rate is only 65.8%. There is a housing crisis and most people are not able to afford a house thanks to rising prices and high mortgage rates.

Interest levels have started to fall but aren’t expected to come down to 6% anytime soon. Furthermore, available credit for mortgages has been tightening. This indicates tightening lending standards and the difficulty in getting approved for a loan.

Still, there are ways to get approved:

• Improve your credit score, you’re more likely to get approved if you have a score of 620 or higher.

• Work on your debt-to-income (DTI) ratio and try to keep it under 40%.

• Lenders pay attention to income history. You're more likely to be approved if you have been employed for at least two years or if you have a solid and guaranteed income. Also, all income must be provable.

• Show your assets as accessible funds prove liquidity. Also, consider going for a large deposit as it helps bring the LTV ratio down and makes you eligible for more deals.

• This might come as a surprise but the property type can impact your chances of approval. Applicants looking for a primary residence find it easier to get approved than applicants looking for an investment property. However, in some cases, buying a rental property first may make more sense.

• Consider paying off existing debt and avoid applying for new debt.

Always compare lenders and choose the right mortgage option. Government-backed loans such as FHA, VA, and USDA loans are more affordable and easier to apply. On the other hand, conventional loans are stricter to qualify for.

Check this video for some more tips:

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👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.