Controversial Collision: Tesla Shares Crash in Stock Market Amid Trump-Musk Dispute
A Tumultuous Day on Wall Street: Tesla's Slide after the Musk-Trump Feud
📸 By our website with AFP
The Big Apple's financial heart, the New York Stock Exchange, witnessed a tumultuous day for the electric vehicle pioneer, Tesla. The stock plummeted on June 5, following a bitter spat between Tesla's CEO, Elon Musk, and the former US President, Donald Trump.
Tesla's shares dived a staggering 14.26%, settling at $284.70, erasing around $150 billion from the company's market capitalization. This substantial drop pushed the automaker back under the $1 trillion mark, marking a significant blow to the company's reputation.
The animosity between the two billionaires was ignited when Trump reprimanded his former adviser, Elon Musk. Trump's criticism was in response to their disagreements over the megabudget bill. During a candid exchange with journalists, Trump voiced his disappointment and suggested canceling government subsidies and contracts for Tesla and SpaceX, should Musk remain CEO.
Billionaire's War of Words: A Friendship Turned Foe
In response, Elon Musk branded Trump's anger as "nonsense." He also flatly denied having prior knowledge of the text content, which Trump claimed the entrepreneur possessed. Musk claimed that Trump's victory in the 2024 elections would have been unattainable without his support, accusing Trump of ingratitude. Some analysts have noted the rapid deterioration in their friendship as astonishing and potentially concerning for current Tesla investors.
Daniel Ives, an analyst at Wedbush Securities, comments on the conflict saying, "The heated exchange between Musk and Trump has investors in Tesla worried about the future."
Elon Musk: A Visionary or a Distraction?
Musk's public statements have been known to impact Tesla's stock price in the past, causing fluctuations on the market. This latest fallout with Trump cooled some car buyers' enthusiasm for the brand.
Just last week, Musk confirmed that his departure from Trump's government was planned. His stint at the department tasked with cutting public spending crowned with numerous criticisms from the political realm was a contentious period.
A financial newsletter, Momentum, provided a heads-up about potential gains on Tesla stock, suggesting a purchase at the right time and subsequent sale before the recent plunge. The newsletter's stock selection has outperformed the CAC 40 since its launch.
About the Controversy
The feud between Musk and Trump is a relationship between two powerful figures with differing views on environmental policies, social issues, and public statements. Their dynamic often impacts investor sentiment around Tesla, influencing the company's stock value.
The conflicts between Musk and Trump can also affect regulatory policies, bringing consequences for Tesla's business operations. Moreover, the public figures' statements contribute to market volatility, causing fluctuations in Tesla's shares. However, Tesla's stock performance is influenced more significantly by broader market trends, technological advancements, and regulatory changes in the energy and automotive sectors.
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Artificial intelligence could predict market movements as analysts might use AI to analyze the impact of the Musk-Trump feud on Tesla's stock-market performance, considering their influence on investor sentiment and regulatory policies in the financial sector.
In response to the feud's market implications, some investors might shift their focus from traditional finance and start exploring AI-assisted investing strategies, hoping to capitalize on prediction models that inspect the implications of public figures' actions on the stock-market.
