- Tesla, Nio and XPeng were up on Tuesday after a selloff in the hot EV space and in the tech sector.
- Nasdaq Composite pushes higher after falling into a technical correction.
- Tesla shares reportedly win a rating upgrade and Chinese vehicle sales increased in February.
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Shares of Tesla and other electric vehicle makers shot higher Tuesday, with the broader technology sector shifting into a higher gear after the Nasdaq index fell into a technical correction.
Tesla shares gained 19.6% to end at $US673.58 ($874). That was the first win after five losing sessions that were logged as part of a wider selloff of high-flying tech stocks.
Shares of rival electric vehicle maker Nio revved up 17% to $US41.35 ($54), and XPeng leapt 11%. Nio shares had lost roughly 34% over the past month but were still up considerably from a year ago when they traded at $US3.50 ($5) each.
The EV stocks rose as the Nasdaq Composite popped up 3.7%. The surge followed Monday’s loss of 2.4% that left the index in a technical correction as it had fallen by more than 10% from its most recent high. The recent sell-off took the ‘frothiness’ out of Wall Street’s hottest areas such as electric vehicle makers and SPACs, Bespoke Investment Group said late last week.
Investors in EV stocks had fresh developments to consider on Tuesday. Tesla’s shares were upgraded to a buy rating from neutral at New Street Research, according to Bloomberg, with analyst Pierre Ferragu raising his price target to $US900 ($1,168) from $US578 ($750) as he anticipates a pickup in demand and earnings growth.
Meanwhile, February retail passenger car sales in China rose to 1.18 million vehicles, the China Passenger Car Association reportedly said. Sales a year ago plunged by 79% as the country was in lockdown because of the COVID-19 outbreak.
While shares of Tesla and other electric vehicle makers have been hit during a broader rotation trade, the sales report from China “speaks to our confidence that overall Tesla is poised to gain considerable market share in the key China region over the coming years,” Dan Ives, an analyst at Wedbush, wrote in a note Tuesday.