Tesla Stock Slides 2% as Nasdaq Turns Lower on Rising Wholesale Prices, Cooling a Blistering Robotaxi Rally

Tesla shares fell Friday, giving back part of a sharp weeklong rally as technology stocks turned lower following new wholesale inflation data.

Tesla traded at $388.82 at 10:09 a.m. ET, down 2.17% from Thursday's close of $397.45. The decline pulled the electric vehicle maker back below the $390 level it reclaimed this week.

The broader market was also under pressure. The Nasdaq composite fell about 1% and the S&P 500 slipped about 0.7% shortly after the open, as investors digested the latest producer price index report.

Producer prices rose 6.5% from a year earlier, the largest annual increase since November 2022. Some market watchers noted the monthly reading came in cooler than expected, but the annual figure added to concerns about inflation and interest rates. Higher rates tend to weigh on high-valued growth stocks such as Tesla.

A big week for Tesla

Friday's drop followed a strong run. Tesla shares rose 2.91% on Wednesday and 1.69% on Thursday, part of a gain of more than 15% over the past week.

The rally was driven by a series of company announcements. Chief executive Elon Musk said on X that Tesla would extend Cybertruck production, while handing that line's capacity toward what he described as increased Cybercab production. Tesla's robotaxi service also expanded to San Antonio, Texas.

On Wednesday, Finland's transport agency, Traficom, recognized a Dutch provisional type approval for Tesla's assisted driving system, a step toward wider use of its driver-assistance technology in Europe.

Bloomberg has also reported that Tesla and SpaceX could announce a merger as soon as December. Neither company has confirmed a deal.

Recovering from a post-election slump

The recent gains came after a rough stretch for the stock. Tesla fell sharply after the Nov. 3 midterm elections, when early results pointed to Democratic control of Congress. The shares plunged 10.77% on Nov. 5 alone.

Even after this week's rebound, Tesla remains down roughly 12% for 2026. Its 52-week range stretches from $297.38 to $498.83.

Weak car business, rich valuation

Analysts say the core auto business remains a concern. Tesla's retail sales in China fell 66% in October, and its third-quarter operating margin was 2.6%.

The company did beat third-quarter expectations, reporting earnings of 48 cents per share on revenue of $28.05 billion. Analysts had expected 45 cents per share and $27.92 billion in revenue.

Valuation also remains a debating point. At recent prices, Tesla trades at roughly 200 times expected earnings, far above most automakers. Its bull case rests largely on robotaxis, artificial intelligence and humanoid robots rather than car sales.

Wall Street remains divided. Benzinga data shows a consensus price target of about $419. Barclays, UBS, CLSA and Morgan Stanley raised targets last month. GLJ Research, a longtime skeptic, has kept a $25 target.

Investors will watch for any official word on the reported SpaceX tie-up, further robotaxi expansion and Tesla's year-end delivery numbers.

This article is for informational purposes only and does not constitute investment advice.