Tesla Shares Surge After Recent Decline Amid Market Gains

Tesla (TSLA) shares experienced a notable rebound on Wednesday, climbing 4.33% as they recovered from a dip the previous day. By 1:06 p.m., Tesla’s stock had risen 4.2% to reach $231.90. This uptick aligns with broader market movements, as the S&P 500 (SPX) and Nasdaq Composite (COMP) were both showing gains, up 1.6% and 2.2% respectively.

Nvidia Boosts Market Sentiment

A significant factor contributing to the positive market environment was Nvidia’s (NVDA) impressive performance. Nvidia’s shares surged 11% after Morgan Stanley analyst Joseph Moore named it his top pick. Moore cited the recent selloff as an opportunity and set a price target of $144 for Nvidia. This boost comes in the wake of Nvidia’s stock having dropped 23% from its highs in July. Investors had previously rotated out of technology shares following strong gains earlier in the year. Despite this, the Nasdaq 100 was still up approximately 19% and Nvidia’s stock had soared 122% over the past year.

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Tesla’s Semi-Truck Update

Morgan Stanley transportation analyst Ravi Shanker also highlighted a significant development for Tesla. On Wednesday, Shanker reported that Tesla had provided an update on its semi-truck product. The update included a photo of a factory under construction and noted that production is scheduled to begin in 2025. Although Tesla’s second-quarter earnings report initially mentioned this update, Shanker emphasized its importance. He highlighted it as a key milestone in the commercialization of electric vehicles for commercial trucking.

Impact of Recent Developments

Wednesday’s gains for Tesla come after a 4.1% decline on Tuesday. The drop partly resulted from Tesla recalling 1.8 million vehicles to address a hood-latch issue. Tesla is resolving this problem through a software update instead of requiring a visit to the repair shop. The stock’s recovery was further bolstered by another Morgan Stanley analyst, Adam Jonas. On Monday, Jonas named Tesla as his top pick and assigned it a Buy rating with a price target of $310. This indicates a potential 40% upside.

Volatility and Future Outlook

The recent volatility in Tesla’s stock is also a factor. Following a weaker-than-expected second-quarter earnings report, Tesla’s shares had fallen 12.3%, but rebounded with a 7% increase over the subsequent three days. As of Wednesday, Tesla’s stock was down approximately 10% year-to-date but up about 60% from an intraday 52-week low of under $140 set in late April.

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