Technology Stocks Lead Market Higher Despite Another Tesla Crash
Stocks soar despite coronavirus and a recession. At the same time, the steady rise of passive investing, in particular index funds that buy a broad cross section of stocks, has had a massive influence on the market's long bull run. But a wave of relatively unsophisticated investors has joined the frenzy with the help of unconventional middlemen like E-Trade, a low-fee online brokerage that makes buying stocks as easy as buying stuff on Amazon.
The latest storm over Elon Musk's tweet about production figures won't help matters either, and if the Securities and Exchange Commission succeeds in getting Musk barred from being a director (unlikely, but possible) Tesla's shares could end up plummeting.
Then there's the success of Chief Executive Elon Musk in crafting a beautiful-future narrative to explain why Tesla should be even more expensive than it is. Musk's enormous compensation package is almost entirely tied to share price; on Tuesday, he qualified for an additional $2.1 billion worth of options after Tesla's average market capitalization over a Tesla Analysis six-month period exceeded $150 billion.
I know the Republicans already tried to change MO law to ban Tesla sales, advertising ability, charging ability, maintenance and basically stop Tesla's from being a viable car in MO. It was a strict crafted piece of legislation banning auto-manufactures from doing any of those things.
TSLA is the most shorted stock across the US stock market, with short interest currently at $26.88 billion as of Thursday, according to financial analytics firm S3 Partners. Tesla insists that US orders for the Model 3 are strong, and that the company simply couldn't deliver all ordered vehicles in the first quarter.
Investors aren't spreading their cash broadly but are mostly piling it into stocks of companies that appeared certain to thrive during the coronavirus crisis. Wall Street's average stock price target on Tesla is slightly above $1,200 - more than $300 below its current level.
Stimulus checks are effectively a short-term form of Universal Basic Income (UBI), an idea which has been advocated by among others, former presidential hopeful and serial entrepreneur Andrew Yang, as well as Mark Zuckerberg of Facebook, and Elon Musk of Tesla.