Tesla Gathers Momentum In Second Straight Session After Q2 Selloff; Are China Concerns Overblown? - Investor's Business Daily

Tesla (TSLA) stock advanced for a second consecutive session Tuesday as TSLA recorded its second best daily gain Monday since March 21, breaking a string of six straight losses.

TSLA jumped 2.8% to 237.80 during Tuesday's market trading as last week's China insurance registration data showed Tesla sales remained almost flat vs. the prior week. On Monday, Tesla stock gained 7.3% to 231.28. Monday's performance cut TSLA stock's losses in August to 13.5%.

So far in August there have been 39,400 Tesla insurance registrations in China, that's up 125% vs. the same period in 2022 and keeps the EV company on pace to be around its China Q2 levels.

In the second quarter, Tesla sold 247,217 China-made vehicles, representing about 53% of Tesla's record setting 466,140 global deliveries. Analysts expect 473,000 global deliveries in Q3, according to FactSet.

Meanwhile, reports continue to circulate about the Tesla's updated Model 3, code-named Highland, in China. On Tuesday, a local media source reported that mass production and deliveries of the new Model 3 will start at the end of September. Other local news outlets said some stores are already taking reservations for the Model 3.

There is also more executive shakeup at Tesla. On Monday, Colin Campbell, who served as vice president of powertrain engineering, announced on LinkedIn he had left Tesla after seventeen years. Campbell is joining Redwood Materials as chief technology officer. Redwood Materials was founded by Tesla co-founder and board member JB Straubel.

This comes after Tesla announced on Aug. 7 that Chief Financial Officer Zachary Kirkhorn had stepped down. The EV giant reported in federal filings that Vaibhav Taneja took over from Kirkhorn on Aug. 4. Taneja will now serve as CFO as well as his current role of chief accounting officer.

Tesla Stock: What's It Doing

TSLA shares have been pulling back since reporting second-quarter financials on July 19. Investor concerns over falling gross margins outweighed the global EV giant's above-forecast earnings and revenue. News of sales from Cathie Wood's ARK Invest ETFs may also have fueled some downside momentum.

Tesla stock declined more than 11% to 215.49 last week in six consecutive losses. Two weeks ago, Tesla stock undercut support at the stock's 50-day, 10-week moving average. TSLA finished that week more than 2% below the 10-week line, which is a clear sell signal, according to IBD analysis.

However shares roared back Monday. TSLA is above its 200-day moving average.

Tesla stock ranks fourth in IBD's automaker industry group. It has a 94 Composite Rating out of 99. Tesla stock has a 87 Relative Strength Rating and its EPS Rating is 94 out of 99.

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