Tesla Stock 11% Drop Leads Nasdaq Selloff as Tech Stocks Sink
Stock markets are down again today, with Tesla falling 11% so far, pulling Nasdaq index lower as well, however the shares of most major tech companies are declining as well.
Tech Stocks Drag Nasdaq Lower
The stock market downturn continues, with the tech-heavy Nasdaq Index facing intense selling pressure as key technology stocks retreat. The Nasdaq is down 3.5%, approaching one of its worst daily losses of 2024, and has now fallen over 15% from its peak of 20,000 points in early February. The index is currently testing the 20-week SMA (yellow), while the 200-day MA at 20,000 remains far above.
Nasdaq Chart Weekly – Facing the 50 SMA
Since the US session opened, losses have accelerated sharply, with Tesla stock leading the decline, now touching $230. Tesla opened 3.8% lower with a negative gap and has since continued its downward trajectory.
Tesla Hit Hard by Weak Q1 Deliveries
In addition to overall market weakness, Tesla’s disappointing Q1 2025 delivery numbers have further weighed on its stock.
- USB analysts revised Q1 delivery estimates to 367K units, down from 437K previously expected.
- Tesla’s gross margins fell to 10.3%, down from 18.1% in Q1 2024.
- Revenue growth remains sluggish at just 0.95% over the past year, raising concerns about future profitability.
Although anti-Tesla and anti-Dogecoin protests took place over the weekend, these events are unlikely to significantly impact Tesla’s overall sales.
Historical Volatility and Market Outlook
Tesla’s stock has always been highly volatile, making this latest decline part of its long-term price cycle.
- The stock rallied 350% in 2023, climbing from $140 in April to its record high of $488 in December.
- It then fell sharply in Q1 2025, before recovering 300% from its April low.
- Now, Tesla is more than 50% below its December peak, reflecting a broader selloff in tech stocks.
Beyond Tesla’s individual challenges, broader macroeconomic and geopolitical tensions continue to fuel market instability. The ongoing tech sector downturn is being compounded by political, economic, and trade uncertainties.
Will Tesla Recover?
Despite today’s selloff, history suggests Tesla has the potential to rebound once market sentiment stabilizes. If promotional efforts drive late-quarter delivery growth and investor confidence in tech stocks returns, Tesla could find support and stage another recovery in the coming months.
Nasdaq Index Live Chart
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