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Tesla sinks below the price at which it entered S&P 500 index

The stock dropped as much as 9% to $650 premarket in New York.
Image: Qilai Shen/Bloomberg

Tesla shares are trading below the level where they were when the electric-car maker entered the S&P 500 Index in December.

The stock dropped as much as 9% to $650 premarket in New York, after falling a similar amount on Monday. Through Monday’s close, the stock was down 21% from its January 25 record intraday high. If these declines hold in regular trading, the shares would wipe out all their gains so far this year.

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Tesla’s early-week decline amid a wider market sell-off was fueled in part by Chief Executive Officer Elon Musk’s comments over the weekend that the prices of Bitcoin and smaller rival Ether “do seem high.”

The concerns over the value of the cryptocurrency helped erase some of Bitcoin’s gains, which had rocketed to new highs after Tesla announced two weeks ago it added $1.5 billion in Bitcoin to its balance sheet.

Smaller electric vehicle stocks, that typically take their daily trading cues from Tesla, also dropped sharply in premarket trading. The breakneck rally in many of the pure-play EV makers has slowed down considerably in the new year as investors grew wary of increasing competition from traditional auto companies, such as General Motors and Ford.

© 2021 Bloomberg

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Watch this one tank.

When all car makers squeeze every Dollar to remain profitable and remain in business, this one literally prints Dollars.

Most other car makers are so far behind that the squeeze will not save them. Besides, Tesla was up more that 700%, a 20% drop is nothing.

-8% x 2 in two days is not so bad, it has a long way to go to $250

End of comments.

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