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Why Tesla Stock Jumped on Monday

By Daniel Sparks – Updated Jun 1, 2020 at 6:42PM

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Despite no notable Tesla-specific news over the weekend, shares of the electric-car maker are rising on Monday. Here's what investors should know.

What happened

Shares of electric-car maker Tesla (TSLA -8.79%) jumped on Monday, rising nearly 8% by the time the market closed.

The stock's gain likely reflects a combination of Elon Musk's success at the other company he runs, SpaceX, over the weekend, and a good day in the market for many growth stocks

A Model X in Tesla's factory in Fremont, California

Image source: The Motley Fool.

So what

On Saturday, spaceflight company SpaceX -- founded and led by Musk -- successfully sent two NASA astronauts to space atop SpaceX's Falcon 9 rocket on its Crew Dragon capsule. On Sunday, the Crew Dragon capsule docked to the International Space Station, marking the first time a commercial spacecraft has brought humans to the ISS. According to search trends on Alphabet's Google, the launch appears to have spiked interest in Tesla -- another company Musk founded. Perhaps the successful launch gave investors more confidence in Musk's leadership.

Additionally, large-cap and megacap growth stocks had a good day in the market, with many of them seeing percentage gains well in excess of the S&P 500's 0.4% move higher. It wasn't surprising to see Tesla follow suit as it is a growth stock in its own right.

Now what

Shares of Tesla have been rising over the last few months, recovering almost all of their losses since the coronavirus market crash. Investors are likely optimistic about the company's prospects given the automaker's launch of the Model Y and a return to production at its factory in Fremont, California.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), and Tesla. The Motley Fool has a disclosure policy.

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