Technology
Friday, November 8th, 2024 4:01 pm EDT
Key Points
- Tesla’s stock rose over 6% on Friday, pushing its market cap above $1 trillion for the first time, following a 27% weekly surge after Donald Trump’s presidential election win, which investors believe could benefit Tesla.
- Elon Musk has been a major supporter of Trump, contributing at least $130 million to pro-Trump efforts, which has raised expectations of favorable policies for Tesla under a Trump administration.
- Analyst Dan Ives suggests that less regulation, the potential removal of the $7,500 EV tax credit, and higher tariffs on Chinese EV imports could strengthen Tesla’s competitive advantage in the U.S. market.
Tesla’s stock surged over 6% in Friday morning trading, bringing its market capitalization above $1 trillion for the first time. This significant rally, around 27% in the past week, came after Donald Trump’s win in the U.S. presidential election, fueling investor optimism that a Trump administration could favor Tesla’s growth. Elon Musk, Tesla’s CEO, has been a notable Trump ally, contributing at least $130 million to Trump-supporting efforts. Before this stock rally, Tesla’s market cap was $807.1 billion, with its stock up roughly 1% for the year; now, Tesla has gained about 26% year-to-date.
Analyst Dan Ives from Wedbush Securities suggests that a potential Trump administration could reduce regulatory restrictions on Tesla and other corporations. Trump previously hinted at possibly cutting the $7,500 federal electric vehicle tax credit, which Ives argues might benefit Tesla in the long run. He believes Tesla’s scale in the EV industry could position it as a dominant player in a reduced-subsidy environment. Additionally, if Trump imposes higher tariffs on Chinese imports, it may discourage cheaper EV makers, like BYD and Nio, from entering the U.S. market, enhancing Tesla’s competitive position.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/11/08/tesla-hits-1-trillion-market-cap-as-stock-rallies-after-trump-win.html
