What Happened?
Shares of electric vehicle pioneer Tesla (NASDAQ: TSLA) jumped 5.2% in the morning session after the major indices (Nasdaq +2.0%, S&P 500 +1.5%) rebounded as President Trump postponed the planned 50% tariff on European Union imports, shifting the start date to July 9, 2025.
Companies with substantial business ties to Europe likely had some relief as the delay reduced near-term cost pressures and preserved cross-border demand.
The update should be beneficial for Tesla, as data from the European Automobile Manufacturers' Association revealed the company sold 7,261 cars in Europe in April 2025, down 49% year on year. So, the delay could help the company avoid being caught in the crossfire of retaliatory tariffs and potential complications from escalating trade tensions between the US and the EU.
Contributing to the stock's momentum, CEO Elon Musk noted in a social media post on X (formerly Twitter) that he would be allocating more of his time to the company. He added, "I must be super focused on /xAI and Tesla (plus Starship launch next week), as we have critical technologies rolling out."
After the initial pop the shares cooled down to $355.91, up 4.9% from previous close.
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What The Market Is Telling Us
Tesla’s shares are extremely volatile and have had 128 moves greater than 2.5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock gained 3% on the news that CEO Elon Musk said he's sticking with the company for the next five years, which should reassure investors about leadership stability.
Musk also highlighted his desire to keep control over the company while spending less time on political campaigns, signaling a renewed focus on the company's operations and long-term growth priorities.
Tesla is down 6.2% since the beginning of the year, and at $355.91 per share, it is trading 25.8% below its 52-week high of $479.86 from December 2024. Investors who bought $1,000 worth of Tesla’s shares 5 years ago would now be looking at an investment worth $6,509.
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