The beginning of the new week brought a new record high for the Nasdaq Composite (^IXIC -2.05%), which is now within spitting distance of a major milestone. After its rise of around 0.75% as of 3:15 p.m. EDT, the index is just 1% below the 10,000 level, and the amazing speed of its bounce from the coronavirus bear market shows just how upbeat investors are about the prospects for a full economic recovery as the spread of the pandemic begins to slow. The Nasdaq 100 index of top Nasdaq stocks posted slightly smaller gains of around 0.4%.
Helping lead the way higher for the Nasdaq 100 was Tesla (TSLA -1.92%), which picked up around 6% on the day. Yet as strong a performance as that was for the electric-vehicle first mover, Tesla's gains were nothing compared to upstart electric-truck company Nikola (NKLA -2.44%), which not only took its name from the same inventor but also is looking to expand its addressable market in much the same way Tesla is.
China still loves Tesla cars
Tesla's gains came on news that the car company saw signs of recovery in the key Chinese auto market. China was early to close down as a result of the coronavirus pandemic, but it's also been quicker to get back to normal. That's been good news for businesses with a presence there.
Tesla's turnaround in China was especially abrupt. Vehicle sales volumes had dropped by 64% in April to 3,645 units, down from 10,160 in March. However, in May, volumes jumped to 11,095 -- triple April's total and actually up from March levels.
If things go well, China will be an increasingly important market for Tesla. The company just opened its Shanghai Gigafactory earlier this year, and being able to deliver vehicles within the country avoids the prospects of further trade tensions between the U.S. and China while also providing greater access to the world's second-largest economy. China could become the company's launch point for vehicle deliveries across the Asia-Pacific region.
Some have worried that vehicle delivery figures in the U.S. and elsewhere could be quite weak due to the pandemic. However, today's news suggests that any hiccup in sales might be short-lived and give way to an even bigger recovery after the worst of the outbreak is over.
Nikola keeps on truckin'
Also on the Nasdaq, shares of Nikola soared, climbing 85% as of 3:15 p.m. EDT. The newly public entity, which used a merger with special-purpose acquisition company VectoIQ to make its shares available to ordinary investors, made a big announcement about its first major product line.
Nikola Badger pick-up truck. Image source: Nikola.
Nikola founder and board chair Trevor Milton tweeted that the company would start accepting reservations for its Badger pickup on June 29. Dubbing the Badger "the most bad ass zero emission truck," Milton threw some PR jabs at Tesla, saying, "You'll get to see a real operating truck, not a fake show truck."
Comparisons between Nikola and Tesla have been inevitable ever since the company chose the first name of the inventor whose last name adorns Elon Musk's rival business. However, Nikola has a different technological emphasis, with plans to offer not only battery-powered vehicles but also trucks that use hydrogen fuel cells for power.
As much attention as the Badger is getting, Nikola's big plans are for the commercial-truck market, with hopes to release its semi truck before Tesla's appears on the market. For those looking for greater use of electric-powered vehicles, this could be just the beginning of a huge battle between these Nasdaq-listed rivals -- and at just a tiny fraction of Tesla's size, Nikola has a lot more road to run in order to catch up.
