MULN stock falls further after negative Hindenburg report

MULN stock losing momentum rapidly as it closed down 10% on Thursday.
Mullen Automotive down another 3% in Friday's premarket.
MULN suffering as Hindenburg Research issued bearish report.

Ivan Brian FXStreet

MULN stock shed a lot of ground on Thursday as the effects of a strongly bearish report from the Hindenburg report likely hit home with investors. Mullen Automotive shares fell by just over 10% to close out Thursday at $2.38. MULN stock had traded up to $4.18 just two weeks ago as the stock saw a frenzy of buying from retail traders.

MULN stock news: Hindenburg vs Mullen

During the aforementioned interview Mullen CEO David Michery said that the company was looking to bring all of its manufacturing back to the US to try and avoid supply chain issues plaguing the industry.

Hindenburg Research says Mullen is importing vehicles from China and rebranding them with Mullen logos: "The two electric cargo vans that Mullen claims it will be manufacturing are Chinese EVs rebranded with a Mullen logo. Import records show the company recently imported two vehicles from China, one of each model".

Hindenburg also questions the battery technology which Mullen claims to the mastered: "Mullen recently press-released an update on its battery testing, sending its stock soaring 145% in a day. In reality, the “news” appears to be a rehash of testing the company had already announced in 2020. Mullen misrepresented the test results, according to the CEO of the company that performed the tests". The Hindenburg report also goes on to make other claims about the lack of EPA certification which is needed to sell vehicles in the US and also issues around Mullen's the DragonFly.

We should point out we have no way of verifying the claims made by Hindenburg, we are merely reporting them. As far as we know Mullen has not commented on the claims made by Hindenburg.

MULN stock forecast: Momentum keeps fading

Before this report came out we had already warned that the momentum for MULN stock was fading and it was likely time to get out. Most of these retail and meme stocks thrive on momentum and knowing when to get out is key. Once mentions fall on social media and the stock closes below its open then this is a warning sign. This is exactly what happened to MULN stock on March 31. The most recent spike was also not able to break the previous high at $4.21 which was another sign that this time momentum was not as strong. Now momentum is gone and the next target for bears is $2.06.

MULN stock chart, daily

Author

Ivan Brian

FXStreet

Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.

GBP/USD: Daily gains remain capped by 1.3650

GBP/USD leaves behind Monday’s pessimism and advances marginally on Tuesday. Cable’s humble gains, however, appear to have met quite a decent resistance in the 1.3650 zone for now, in a context of a slight selling pressure hovering around the Greenback.

EUR/USD struggles to regain pace; gyrates around 1.1670

EUR/USD clinches humble gains around 1.1670 following Tuesday’s close on Wall Street. Indeed, marginal losses in the US Dollar encourages spot to set aside two dauly pullbacks in a row and maintain the 1.1700 barrier on the cross-hairs for now. Moving forward, US inflation tracked by the PCE and another revision of Q2 GDP data should keep investors entertained on Wednesday.

Gold: Buyers still hold the grip

Gold navigates the middle of its daily range near $4,650 per troy ounce on Tuesday. The lack of clear direction in the yellow metal comes on the back of the widespread cautious tone among market participants, a mildly offered stance in the US Dollar and a marked decline in US Treasury yields across the curve.

Australia CPI expected to show inflation easing in July

The Australian Bureau of Statistics (ABS) will publish the July Consumer Price Index (CPI) on Wednesday at 01:30 GMT. The report is expected to show that inflation rose 3.2% from a year earlier, easing from the 3.8% posted in June. The monthly CPI, however, is forecast at 0.8% following the -0.1% print from the previous month.

Canada hits US goods with tariffs; The rate market sees a problem

On September 8, Canada begins charging its own importers 15%, 25% and 50% on roughly 700 lines of American goods. The measure is billed as dollar for dollar, and on the arithmetic of covered trade it is. What it is not is a tax on the United States.