Tesla (NASDAQ: TSLA) surged 6% to close at $368.81, with trading volume reaching 102.3 million shares, slightly above its three-month average of 89.7 million, indicating increased investor interest in the electric vehicle manufacturer.
The broader market also strengthened, with the S&P 500 rising 0.9% to 6,587.47 and the Nasdaq Composite climbing 0.7% to 22,043.07. Both indexes reached record highs, boosting sentiment across growth stocks.
Across the EV sector, Rivian Automotive (RIVN) edged up 0.5% to $13.97, while Nio (NIO) jumped 6.1% to $6.07. Tesla’s stronger performance may reflect investor preference for established leaders in the EV industry.
The gains followed the release of key economic data: the August CPI came in higher than expected, nearly a full percentage point above the Fed’s 2% target, while jobless claims surged to their highest level since October 2021, significantly exceeding expectations. The market believes weak employment data will outweigh inflation concerns, reinforcing expectations of imminent rate cuts. Such expectations typically benefit the stock market, particularly high-risk stocks.
Although industry data shows Tesla’s U.S. market share has fallen to multi-year lows amid intensified competition from legacy automakers and lower-priced rivals, overall U.S. EV sales hit a record high this week. Investors appear focused on strong overall EV demand and Tesla’s scaling advantage. Third-quarter delivery figures will serve as a key test for whether the momentum in Tesla’s share price can be sustained.
Still, significant risks remain. Tesla’s forward price-to-earnings ratio exceeds 136, indicating extremely high valuation levels. At the same time, the company’s sales continue to decline across major global markets, underscoring its investment risk.
