July 2, 2022

NyseNewsAnalyst

News Headlines: Hindustan Times provides exclusive top stories of the day, today headlines from politics, business, technology, photos, videos, …

Kathy Wood has a simple response to Tesla’s exit from the S&P 500 ESG: ‘ridiculous’

Kathy Wood has a simple response to Tesla's exit from the S&P 500 ESG: 'ridiculous'

Cathy Wood wasn’t happy to dismiss one of her most famous investments, Tesla Inc. , from a prominent index that tracks environmentally and socially friendly companies.

“Silly,” Wood was terse in response to the news that the S&P 500 ESG had brought down electric car maker Elon Musk’s Tesla TSLA,
-6.80%
of its lineup, as part of the annual rebalancing.

Read: Tesla dumped by S&P ESG indicator and Musk Cakes is a scam

Margaret Dorn, Senior Manager and Head of ESG Indexes, North America, at S&P Dow Jones Indexes writes, In a blog post dated Tuesday.

The announcement from S&P Dow Jones Indicators may come as a shock to some, given that the car manufacturer is seen as a leader in producing electric vehicles for the masses, and may lay the foundation for major manufacturers such as Ford Motor F,
-5.54%
and General Motors, General Motors.
-5.96%And
who are racing to compete with Tesla in electric cars on a larger scale after they trailed Musk & Co. in the low carbon class.

Dorn explains that two of the factors that contributed to Tesla’s disqualification were “low benchmarks” in terms of its low-carbon strategy and its “code of business conduct”.

Tesla was one of Wood’s biggest and most successful investments, CEO of ARK Investment Management, whose rise to disruptive companies like Tesla helped propel her to fame on Wall Street.

However, Wood’s main fund has been affected by the economic downturn, which has upended a large portion of the market in growth-oriented, technology and technology-related investments.

Wood’s flagship ARK Innovation ETF ARKK,
-4.43%
It’s down about 74% from its peak in mid-February 2021, and is down more than 56% so far in 2022.

See also  Elon Musk seeks to cancel deal due to Tesla tweets derailed

Tesla stock is down more than 42% since its last peak in early November. EV stock prices are down 33% so far in 2022.

Meanwhile, Ford and GM shares are down about 38% year-to-date, with the S&P 500 SPX,
-4.04%
Down nearly 18% so far this year, the Dow Jones Industrial Average DJIA,
-3.57%
More than 13% off and the technology-laden Nasdaq vehicle,
-4.73%
down 27%.

Musk also had ideas On the exclusion of Tesla from the ESG index:

Worth reading: “Summer of Pain”? Composite Nasdaq could drop 75% of peak, S&P 500 slip 45% of peak, Guggenheim’s Scott Minerd warns.