Why Ford Stock Crashed This Week, but Could Rebound
Ford Motor Company (NYSE: F) stock plunged 14.5% this week at its lowest point in trading, according to data provided by S&P Global Market Intelligence. Even in a choppy market, shares of the legacy auto maker were holding up surprisingly well this week until Thursday when they crash landed.
There are multiple factors behind Ford stock's steep fall these days, four of which stand out: macroeconomic concerns, a large recall, a hot-selling electric vehicle (EV) hitting a roadblock, and a sharp dip in sales in Ford's second-largest market.
With the Federal Reserve hiking interest rates by a whopping 0.75 percentage points this week after inflation in May topped 40-year highs, may believe a recession is imminent and that's putting auto stocks out of favor with investors. A high inflation and interest rate environment doesn't bode well for auto stocks as debt becomes costlier and sales slow down as auto loans become pricier. To make matters worse, gasoline prices in the U.S. have skyrocketed. Chances are, more consumers will think twice before buying a conventional car now.
Source Fool.com
