Tesla (NASDAQ: TSLA) stock declined 1.43% on Tuesday, following a 6% Monday rally amidst concerns over China sales and the FOMC meeting.
A mix of factors, including tech optimism, bargain-hunting, and the prospect of vehicle price hikes, drove the rally on Monday. This optimism emerged after Tesla shares hit a 10-month low of $160.51 last Thursday, prompting investors to seek opportunities in the perceived undervalued stock.
However, sentiment has shifted as the stock faces several negative catalysts. Data from China revealed a 6.8% week-over-week decrease in insurance registrations for Tesla electric vehicles, with 12,300 units registered in the week ending March 17, as reported by CnEVPost. According to insurance registration data, Tesla’s sales for this month stand at 31,000 units.
China, a pivotal market for Tesla, experiencing softness raises concerns for the EV giant ahead of its first-quarter deliveries report in about two weeks. Analysts have been trimming their sales estimates, fearing they might fall short of consensus expectations.
Meanwhile, investors are eyeing the Federal Open Market Committee (FOMC) meeting, slated as a significant market event for the first quarter of 2024. With the Federal Reserve, led by Jerome Powell, expected to maintain unchanged rates on Wednesday, traders are eager to analyze the post-meeting policy statement, the dot-plot curve, and Powell’s testimony to gauge the future trajectory of interest rates. Currently, the Fed rates stand at a 22-year high of 5.25%-5.50%, a scenario that could unfavorably impact growth stocks like Tesla.
Tesla (NASDAQ: TSLA) Stock Movement
TSLA stock fell 1.43% to close at $171.32 on Tuesday. The traders had exchanged hands with 76,888,550 (76.88 million) shares compared to the average daily trading volume of 105.74 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
