Tesla shares look set to open down Tuesday after closing with a loss of 3.7% to $181.06 in the previous session.
The stock reaction comes after The Wall Street Journal reported Saturday that Tesla Chief Executive Elon Musk took drugs with some Tesla board members, citing people who have witnessed the drug use and others with knowledge of it. The Journal also wrote a story detailing alleged drug use by Musk in January.
Tesla didn’t respond to a request for comment about the weekend report. Musk hadn’t responded to requests for comment in the original report.
Reports of drug use and weak governance can impact investor sentiment. Other automotive stocks were weak on Monday as well. Shares of Ford Motor, General Motors, and Rivian Automotive dropped 4.5%. 2.9%, and 4.2%, respectively.
One problem for the entire sector was rising interest rates. The U.S. 10-year Treasury Bond yield closed at 4.162%, up from 4.023% on Friday. Rising interest rates make purchasing cars, which are often financed, more expensive. Higher rates have been weighing on automotive investor sentiment for months.
Coming into Tuesday trading, Ford stock is down about 8% over the past 12 months, underperforming the S&P 500 by almost 30 percentage points.
Tesla stock was 2% lower in premarket trading Tuesday. Nasdaq-100 futures were up 0.2%. Tesla shares have fallen 24% over the past month while the S&P 500 and Nasdaq Composite have risen 5.2% and 7.4% respectively.
Tesla was trading well off its 52-week high of $299.29, which the company reached last summer. The stock is being outperformed by some of its competitors Tuesday as Lucid is falling just 0.3% to $3.21, NIO has jumped 4.8% to $5.64, and BYD is up 5.4% in Hong Kong trading. General Motors is down 0.1% to $37.74.
Tesla’s trading volume of 134.2 million shares were 16.5 million above its 65-day average volume of 117.7 million however.