Tesla Shares Cap Awful Week With Tentative Rebound
(Bloomberg) -- Tesla Inc. staged a tentative comeback on Friday in the aftermath of a turbulent week that saw shares touch a two-month low and breach a key technical level that portended even more losses.
Investors had dumped the stock for four straight sessions on inflation fears and a “head scratching move” by the company’s chief executive officer.
The stock rose 3.2% Friday amid a broader market rebound. Even with that gain, shares still posted a weekly drop of 12%, the worst since February, as growing inflation concerns weighed on growth stocks trading with high multiples.
Tesla’s weekly drop briefly sent shares below their 200-day moving average, a key technical level that can indicate further declines ahead.
Investors were also whipsawed this week by Elon Musk’s decision to stop accepting Bitcoin for vehicle purchases, citing its environmental impact, just three months after he endorsed the cryptocurrency as a method of payment.
Tesla disclosed in February that it had purchased $1.5 billion of Bitcoin, which fell in the wake of the announcement.
The “head scratching move” to retreat from Bitcoin adds to “the noise and volatility around [Tesla] at a time in which risk assets are under enormous selling pressure on the Street with Tesla leading the charge,” Wedbush analyst Daniel Ives wrote in a note Thursday.
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