General Motors shares jump despite Q4 sales miss

Today’s headlines

What’s happening: Shares of General Motors rose sharply on Tuesday after the company released its fourth-quarter results.

What happened: The automaker missed sales expectations but posted better-than-expected earnings for the latest quarter.

Sales of GM’s EVs (electric vehicles) declined by around 47% year-on-year.

How were the results: The Detroit, Michigan-based company reported a single-digit decline in sales for the fourth quarter.

• Sales fell 5.1% to $45.287 billion, missing consensus estimates of $45.804 billion.
• Adjusted earnings jumped 30.4% year-over-year to $2.51 per share, topping Wall Street expectations of $2.20 per share.

Why it matters: General Motors’ automotive sales declined by around 7% year-on-year in the fourth quarter. EV sales contracted by around 47% year-on-year after federal incentives were paused by the Trump administration.

The company’s quarterly adjusted EBIT rose 13.3% to $2.843 billion during the latest quarter.

General Motors said it expects to record higher profits in fiscal 2026 despite persistent tariff concerns, with the easing of environmental rules projected to provide a boost for its truck and SUV sales.

“For several years now, GM’s strong brands and winning vehicles, as well as our technology-driven services and operating discipline, have delivered consistently strong cash generation,” CEO Mary Barra said. “This has allowed us to execute all phases of our capital allocation strategy, from investing in the business and our people, to maintaining a strong balance sheet and returning capital to shareholders.”

The company’s board raised the quarterly dividend by 3 cents per share to 18 cents per share, while approving a new $6 billion share repurchase authorisation.

General Motors guided for adjusted earnings of $9.75-$10.50 per share for fiscal 2026.

How shares responded: GM’s shares jumped 8.8% to close at $86.38 on Tuesday following the release of quarterly results. The stock has surged around 62% over the past six months.

What to watch: Investors will continue monitoring tariff-related developments, which are expected to significantly impact the company’s results ahead.

The markets today

The Canadian dollar in focus today ahead of Bank of Canada’s interest rate decision

Context: The Canadian dollar fell this morning amid strength in the US dollar.

Details: Data released on Tuesday showed Canada’s wholesale trade rose 2.1% in December, compared to the previous reading of a 1.8% decline. The recent growth in wholesale trade was driven by rising sales of motor vehicles and motor vehicle parts.

Investors also monitored the ongoing trade uncertainty after US President Donald Trump warned to impose 100% tariffs on Canadian imports.

Strength in the US dollar also weighed on the Canadian currency. The US dollar index, which measures the greenback’s performance versus a basket of major peers, gained 0.3% to 96.07 this morning.

Higher prices of crude oil, one of Canada’s major exports, lent some support to the loonie. Spot prices of WTI crude oil gained 0.2% to $62.57 a barrel this morning.

The USD/CAD forex pair rose more than 0.1% to 1.3601 this morning.

What to watch: Investors await Bank of Canada’s interest rate decision (1845 UAE Time) today. Analysts expect the BoC to keep its target overnight rate unchanged at 2.25%.

Data on balance of trade and average weekly earnings will also be released on Thursday. Canada had reported a trade deficit of C$0.58 billion in October versus a surplus of C$0.24 billion in the previous month and is expected to a record a C$0.7 billion deficit in November. Average weekly earnings of non-farm payroll employees, which surged 2.2% year-over-year to C$1,312 in October, are expected to rise by 2.1% in November.

Other Markets: European indices closed mostly higher on Tuesday, with the FTSE 100, CAC 40 and STOXX Europe 600 Index up by 0.58%, 0.27% and 0.58%, respectively, and the DAX 40 down by 0.15%.

The news shaping the markets

Russian forces shot down 105 Ukrainian drones over a 24-hour period. The news sent the USD/RUB pair lower in forex trading this morning.

Australia’s annual inflation accelerated to 3.8% in December from November’s reading of 3.4%. The latest reading coming in above market estimates of 3.6% exerted pressure on the AUD/USD forex pair.

Sri Lanka’s central bank held its benchmark interest rate at 7.75%, which sent the USD/LKR pair slightly lower in forex trading this morning.

Mexico’s trade surplus rose to $2.43 billion in December from $1.85 billion in the year-ago period, exerting pressure on the USD/MXN forex pair.

Brazil’s mid-month consumer prices climbed by 0.20% during the first half of January. This being a deceleration from December’s 0.25% rise sent the USD/BRL pair lower in forex trading this morning.

What else to watch today

Italy’s business confidence (1300 UAE Time), consumer confidence (1300 UAE Time), India’s industrial production (1430 UAE Time) and manufacturing production (1430 UAE Time), US MBA mortgage applications (1600 UAE Time), EIA crude oil stocks change (1930 UAE Time), EIA gasoline stocks change (1930 UAE Time), Fed interest rate decision (2300 UAE Time) as well as Russia’s PPI (2000 UAE Time).