Wall Street Calls Trump-Musk Spat "Disaster" for Embattled Tesla

Bloomberg06-06

For months, Tesla shareholders were tormented by Elon Musk’s role in the administration of President Donald Trump. But any relief brought by his formal government exit last week quickly turned to fear...

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But any relief brought by his formal government exit last week quickly turned to fear...</p>\n\n<a href=\"https://www.bloomberg.com/news/articles/2025-06-05/wall-street-calls-trump-musk-spat-disaster-as-tesla-sinks-14\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":".IXIC","symbol_name":"NASDAQ Composite","start_time":0,"source_url":"https://www.bloomberg.com/news/articles/2025-06-05/wall-street-calls-trump-musk-spat-disaster-as-tesla-sinks-14","article_id":"1136750094","we_media_id":null,"thumbnails":[],"rights":{"source":"lsy1584095487587","url":"https://www.bloomberg.com/news/articles/2025-06-05/wall-street-calls-trump-musk-spat-disaster-as-tesla-sinks-14","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=1136750094","pubTimestamp":1749208346,"columns":[],"sourceInfo":{"source_id":"lsy1584095487587","name":"Bloomberg"},"weMediaInfo":null,"summary":"For months, Tesla shareholders were tormented by Elon Musk’s role in the administration of President Donald Trump. 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But any relief brought by his formal government exit last week quickly turned to fear as the electric-vehicle maker’s chief executive traded barbs with his former boss.Tesla Inc.’s stock plummeted 14% on Thursday after a rift over Trump’s proposed tax legislation exploded into an all-out public feud with the president threatening to end government contracts and subsidies for Tesla and Musk’s Space Exploration Technologies Corp. The rout shed $153 billion from Tesla’s market value, the biggest one-day drop on record, while yielding short sellers $4 billion in gains, according to data from S3 Partners.In premarket trading on Friday, the shares showed some signs of rebounding — rising 4.7% at 4:01 am in New York. Bullish analysts like Wedbush Securities analyst Daniel Ives notes that the feud does not change his view of the stock but “clearly does put a fly in the ointment of the Trump regulatory framework going forward.”While Tesla shareholders are no strangers to stomach-churning swings, Thursday’s slump showcased just how pronounced Musk’s influence over his company’s stock is. And while the rout may eventually present a buying opportunity, some market watchers say it’s too risky to try to catch a falling knife.Shares of Tesla had surged following Trump’s election victory, which many expected to be a boon for the company, given Musk’s proximity to the then president-elect.In the background, however, the outlook for its EV business has been weakening, and Musk’s involvement in political controversies both in the US and abroad has repelled some car buyers and spurred protests against the company. With Thursday’s slide, the stock is down 41% from its all-time high in December.Here’s what’s next for the electric-vehicle maker’s shares, according to market observers.Wayne Kaufman, chief market analyst at Phoenix Financial Services:“The whole thing is idiotic. People in these kinds of positions should know better than to act like kids in junior high. What makes this especially hard for Tesla is that you can’t separate the value of the company from him. Tesla has always traded on Musk. When he looked like a visionary, it rallied. When he did DOGE, it got killed. When he left DOGE, it rebounded. Musk is the guy who made the stock go, so obviously the stock will drop when Musk becomes the issue like this. No one knows what will happen next. However, if there was huge intrinsic value in Tesla, it wouldn’t be plunging the way it is now. It has never traded on fundamentals.”Adam Sarhan, chief executive officer at 50 Park Investments:“Clearly Elon and Trump are no longer aligned. We don’t know the ramifications of this, and that’s why people sold. This isn’t the kind of issue where there will be an all-clear or a resolution. If this escalates, I think it really has the potential to hurt Tesla’s earnings. These are two of the largest personalities on the planet, and if there’s a battle of egos, Trump will come out victorious. The impact for the stock is unknowable. It’s pure gambling at this point, and that’s before we get to how Tesla was already pretty expensive. It is probably becoming more attractive as it sells off, but I cannot in good conscious say that it is cheap.”Ross Gerber, chief executive officer of Gerber Kawasaki Wealth and Investment Management, said on Bloomberg TV:“This is a disaster for Musk. I don’t know if I can spin it in a positive way because it’s just so beyond any intelligent business man’s behavior would be. I can’t imagine after putting Trump in there that he would then turn Trump into an enemy of all things. The board isn’t going to do anything, nobody is going to protect Tesla shareholders and the way you protect yourself is by selling stock, and I personally sold some Tesla stock today. And we’ve been sellers for years and continue to be sellers of Tesla.”Dave Mazza, chief executive officer at Roundhill Financial:“It’s pretty bearish short term obviously. It introduces an added level of complexity that the name doesn’t need right now. People have ignored the issues with car sales because robotaxis are coming and people are willing to give a long leash on that. Now if they’re going to be targeted and Musk personally is going to be targeted then you’re going to take the dream premium down significantly and that’s what we saw today.”Tom Orlik, chief economist for Bloomberg Economics:“Striking against Musk’s companies would put US technology leadership at risk. From SpaceX satellites to Grok AI and the Tesla electric vehicle, Musk’s firms have given the US a competitive edge across strategic sectors. That would be a lot to give up.”","kind":"news","is_publish_news":true,"is_publish_highlight":true,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0,"need_auth":false,"code":"91000000","status":"200"},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":7,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.35.12","shortVersion":"4.35.12","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/1136750094","isCrawlerRequest":true}