What happened
By 10 a.m. EDT on Tuesday, shares of Tesla (TSLA +0.97%) had tanked. The stock was down more than 10%. But as of 12:25 p.m. EDT, shares of the electric-car maker had erased all of those losses.
The stock's volatility comes amid more wild swings in the overall market as investors try to predict the impact that the coronavirus is going to have on the economy and on individual markets.
Tesla's model range. Image source: Tesla.
So what
Tesla's initial big decline on Tuesday came alongside a sell-off in many growth stocks. In addition, the overall market briefly turned negative, albeit only slightly, around 10 a.m. EDT. The S&P 500 had fallen about a half of a percent. But the market rebounded throughout the day. As of 12:33 p.m. EDT, the S&P 500 was up 5.3%.
Shares of Tesla are significantly cheaper than they were in early February. The stock had reached an all-time high of about $969, but now shares are trading at about $441. The stock is still up 84% in the last six months, compared with a 16% decline in the S&P 500 over this same time frame.
Now what
It's unclear how much the coronavirus outbreak will hurt Tesla's production and sales. One analyst argued earlier this week that sales will be hurt as demand for luxury autos is negatively impacted during these times of uncertainty.
When Tesla reports its first-quarter deliveries in the first few days of April, investors should look for an update on production, deliveries, and demand.
