Tesla falls 12% and turns negative for the year
Elon Musk, Tesla CEO, speaks during the launch of the new Tesla Model Y on March 14, 2019 in Hawthorne, California.
Frederic J. Brown | AFP | Getty Images
Tesla’s recent decline accelerated Tuesday as investors turned away from soaring tech names.
The electric vehicle manufacturer’s shares fell 12% in early trading Tuesday after losing 8.55% on Monday, the largest daily loss since September. The stock fell 19% for the week and turned negative for the year on Tuesday.
Tesla is the figurehead for disruptive tech stocks that investors favored in the depths of the pandemic. The tech sector led the market out of the Covid-induced router last year, but more recently investors have been looking elsewhere. Amid stimulus measures and a large-scale vaccine roll-out, some of the rundown and cyclical sectors are now looking more attractive.
Tesla is on track for its third straight week of losses. In light of recent weakness, the stock fell below its 50-day moving average for the first time since November. Moving averages are a technical indicator used to determine momentum.
Tesla is now also exposed to the volatility in bitcoin prices after purchasing $ 1.5 billion of the cryptocurrency. Bitcoin is down 15% in the past 24 hours and broke below $ 50,000 on Tuesday, according to Coin Metrics.
Tesla shares are falling from their record high
The Elon Musk-led company finished 2020 as one of the best performing stocks, and that momentum continued through 2021, with the stock hitting an all-time high on Jan. 25. However, since that high water mark, the stock has fallen 28%.
The company isn’t the only tech name that has come under selling pressure in recent sessions.
On Monday, the tech-heavy Nasdaq Composite fell 2.46% as Apple, Amazon and Microsoft all fell more than 2%.
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