Elon Musk Twitter Poll Sparks Tesla Sell-Off
After spending much of the last few weeks in the news due to its incredible bullish run in the stock market, Tesla is once again making headlines, this time thanks to the antics of eccentric CEO, Elon Musk.
Yesterday, the electric vehicle manufacturer suffered its worst daily performance in the stock market for over a year, with share price plummeting more than 12% during the session. This means that, in just two days, Tesla’s share price has fallen more than 16% - shaving off around $200 billion from the company’s market capitalisation in the process.
The consecutive days of declines come after Musk posted a poll on his Twitter account over the weekend asking his followers whether they thought he should sell 10% of his shares in the company. The poll closed with 58% of voters supporting the proposed sale.
Unsurprisingly, in response to the poll, a sell-off ensued which has been further exacerbated by the news that several other board members, including Musk’s brother Kimbal, have recently filed to sell almost $1 billion worth of Tesla shares between them.
As well as negatively impacting the share price, the saga also raises questions as to whether Musk’s twitter activity is in breach of a previous settlement with the US Securities and Exchange Commission (SEC) – in which he was fined $20 million and forced to step down as Tesla Chairman.
Despite the drastic drop in share price, Tesla remains up around 45% year-to-date. However, investors are likely to remain braced for further turbulence, whilst watching closely for any clues as to Musk’s next move. In the meantime, we can expect more volatility in the Tesla share price and potentially further falls, particularly if - and when - the sale of Musk’s shares materialises.
Five year evolution of the Tesla share price:
- 2020 = +742.62%
- 2019 = +27.21%
- 2018 = +5.89%
- 2017 = +46.38%
- 2016 = -11.38%
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