Tesla stock is down—a lot—to start a new week of trading despite a lack of market-moving headlines. That’s to be expected. These days a small move would be a shocker.
Tesla stock gained about 2% last week, boosted by the increasing likelihood that the Federal Reserve will lower benchmark interest rates in September.
Shares of the electric-vehicle maker were down 3.3% at $212.98.
While there isn’t a lot of Tesla-specific news, there is industry news. Monday, Canada announced 100% tariffs on Chinese car imports. Tesla has shipped cars from its Chinese plant to Canada. A tariff, however, would only be a minor headache. Tesla has two manufacturing plants in the U.S. it can use to serve the Canadian market.
The tariffs probably aren’t causing the steep drop. Tesla stock has just been particularly volatile lately. Since the company reported second-quarter earnings in late July, shares have moved more than 3%, up or down, in 15 of the past 23 trading days.
The recent bout of volatility ran right into the end of this past week. Shares gained 4.6% on Friday after losing 5.7% on Thursday. Overall, Tesla stock gained about 2% for the week, boosted by Federal Reserve chairman Jerome Powell signaling on Friday that it was time to cut interest rates at a speech in Jackson Hole, Wyo.
Powell’s comments helped most stocks, as lower rates generally boost demand and affordability. Cars—big, discretionary purchases—are no exception.
Shares of General Motors and Ford Motor gained about 7% for the week., while Rivian Automotive stock added about 6%.
Looking ahead, investors will be focused on robotaxi developments. Tesla hosts a robotaxi event in October, and CEO Elon Musk has called self-driving robotaxis a trillion-dollar opportunity.
Others are going after a piece of that pie. Uber Technologies announced recently it would integrate GM’s self-driving Cruise vehicles into Uber’s ride-hailing network.
At Tesla’s robotaxi event, investors will want to see a physical robotaxi and hear when Tesla plans to have robotaxis operating on U.S. roads.
Coming into Monday trading, Tesla stock was down about 14% year to date, trailing the Nasdaq Composite by some 30 percentage points. Tesla has faced lower vehicle pricing and profit margins amid higher competition and interest rates. All of that has weighed on investor sentiment.