Tesla (NYSE:TSLA) shares were higher by more than 17% on Wednesday as investors cheered Donald Trump’s election win.
TSLA – Weekly Chart
The price of TSLA jumped above resistance at the $265 level, and now, target prices are near $300. That is one of the barriers ahead of the $414 highs.
Elon Musk has been a regular at Donald Trump’s campaign rallies and has supported the incoming President in interviews. Investors are buying Tesla stock as they expect Trump to repay Musk’s efforts with business-friendly policies that can boost companies like Tesla.
Tariffs on Chinese cars and support for U.S.-based manufacturing plants could be potential returns for Musk. “Trump is not necessarily a big supporter of the concept of a government-led transition to EVs,” iSeeCars analyst Karl Brauer said. “So it’s interesting to see that people feel like Elon’s relationship with Donald Trump will overcome a potential shift in policy because I do think the EPA regulations and expectations for electric vehicle sales and market share are not realistic”.
Musk, the world’s richest man, donated $43.6 million to America PAC in early October. Yahoo Finance reported that his total known political spend this year is over $132 million. Trump has promised Musk a position in his administration, suggesting Musk could lead a commission on cutting government spending.
Musk was not always on the side, saying Trump was too old to run for President again. However, a snub by President Biden at an EV summit was said to be a turning point. His ownership of the X platform also had him fearing that the Democrats would target his free speech ideals if they won.
For now, investors are brushing aside Tesla’s recent sales struggles and are considering the upside of a Trump Presidency for Tesla.
