Stock market today: Tesla shares pop as Elon Musk's promise of cheaper EVs charms investors
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- Tesla shares jumped ahead of the opening bell Wednesday after months of declines.
- The EV maker posted disappointing quarterly earnings, but talk of new models excited investors.
- Meanwhile, Nasdaq futures rose 0.6% and S&P 500 futures ticked up 0.2%.
Tesla's stock rallied before the opening bell on Wednesday as investors reacted to the electric car maker's first-quarter earnings report.
Shares rose as high as 13% in premarket trading and were still up 10% shortly after 5 a.m. ET, putting the company's valuation on course to rise by about $45 billion.
The gains came after Tesla's earnings of $0.45 per share for the three months ending March 31 missed analysts' expectations.
Traders appeared to shrug off those disappointing results and instead focus on the "Magnificent Seven" company's promise of producing new, more affordable EVs from next year.
"We have updated our future vehicle line-up to accelerate the launch of new models ahead of our previously communicated start of production in the second half of 2025," Tesla said.
Tesla's announcement is a "positive story," Sophie Lund-Yates, Hargreaves Lansdown's lead equity analyst, wrote in a morning research note.
"The market responded well to news it's planning to accelerate the launch of its new models," she added. "This will put the brakes on planned cost cutting, but is a way to hopefully boost volumes. In the increasingly competitive space of EVs, Tesla's must-have status is one element it has above the others."
Tesla's premarket surge will be welcome news for shareholders after the stock's dismal start to 2024. It's tumbled 42% year-to-date, dragged lower by signs of a slowdown in demand for electric vehicles.
Meanwhile, US stocks looked set to start the day in the green, with S&P 500 futures up 0.2% and Nasdaq 100 futures climbing 0.6%. Dow Jones Industrial Average futures were trading flat at last check.