Tesla’s stock surged by more than 14% to close at $288 during the New York trading session on November 6, 2024, as investor sentiment shifted sharply into bullish territory.
The rally followed Donald Trump’s victory in the U.S. presidential election, with market participants anticipating favourable policies for the electric vehicle giant.
Elon Musk, Tesla’s CEO and an outspoken supporter of Trump, played a pivotal role in the campaign through a substantial $132 million in donations and strategic messaging on social media platform, X (formerly Twitter).
While it remains uncertain how Musk’s influence might shape the Trump administration’s policies, Wall Street analysts speculate that regulatory shifts under the new administration could benefit Tesla.
The optimism drove a significant daily market volume, with over 165.2 million shares exchanged.
Surging past the key resistance level of $273.41, the stock settled at $288.53, reflecting a 14.75% gain and adding approximately $13 billion to Musk’s personal wealth from his Tesla holdings.
Tesla’s market performance in 2024: A year of recovery
Tesla entered 2024 trading at $250 after a year of mixed price movements in 2023, but the early months of the new year presented challenges. By January’s close, the stock had dropped to $187.29, reflecting bearish pressure despite a robust trading volume of 2.3 billion shares.
- February offered a glimmer of hope, with positive price movements and sustained trading activity. However, a first-quarter earnings report in April revealed a 9% revenue decline—the sharpest drop since 2012—sending the stock down to $183.27.
- Starting in April, Tesla began a steady recovery, gaining momentum through the summer. By September, the stock had climbed back to $260, driven by improving fundamentals and bullish investor sentiment.
Despite a slight pullback in October, the recovery trajectory remained intact, setting the stage for the dramatic post-election rally. Trump’s victory served as a critical catalyst, pushing Tesla’s shares above the $270 resistance zone to achieve a new high of $288.53, a stark contrast to its $251.40 closing price the day before.
What to Know
- Elon Musk’s support for Trump was both strategic and substantial. As one of the former president’s top financial backers, he contributed $119 million to mobilize Republican voters and pledged to donate $1 million daily to individuals signing a petition supporting his political action committee.
- Musk’s influence extends far beyond politics. As Tesla’s largest individual shareholder, he holds over 411 million shares, accounting for approximately 13% of the company’s outstanding common stock.
- In addition to Tesla, Musk holds significant stakes in X and SpaceX, cementing his position as one of the most influential figures in technology and finance.
- Due to Elon Musk’s support for Trump, investor sentiment drove the stock rally, which boosted Tesla’s market capitalization by $120 billion, pushing it above $900 billion for the first time since July 2023.
While Tesla’s impressive rally underscores investor confidence in a favourable policy environment, the road ahead remains uncertain.
For now, Tesla’s upward momentum is a testament to the market’s optimism and Musk’s ability to align his vision with the prevailing political winds.