Tesla shares experienced a sharp reversal on Tuesday, initially climbing about 1% to $413.20 before tumbling roughly 5% as a broader technology and semiconductor selloff crushed investor sentiment. The early uptick came after the release of new Full Self-Driving (FSD) safety data from the Netherlands, where Tesla reported 3.5 times fewer collisions for FSD users on Dutch public roads compared to the baseline. This data is expected to bolster Tesla’s push for European regulatory approval of its driver-assistance system.
ARK Invest’s Cathie Wood added to the morning’s positive buzz by posting a video of a smooth Tesla robo-taxi ride, joking only about a $75 parking ticket. JPMorgan’s upgrade from underweight to neutral with a $475 price target, along with recent buy ratings from Goldman Sachs and Deutsche Bank, further supported initial gains. Institutional ownership now sits at 66.2%, with Vanguard and Norges Bank among recent buyers.
However, the positive momentum collapsed as the iShares Semiconductor ETF fell 5%, erasing much of Monday’s rebound, and heavyweight tech names like Micron and Broadcom dropped over 5%. The S&P 500 lost 1.3%, while the Nasdaq Composite sank 2.1%. Heightened caution ahead of SpaceX’s highly anticipated IPO, also tied to Elon Musk, may have added to profit-taking in Tesla stock.
Providing a regulatory bright spot, Denmark’s Road Traffic Authority granted provisional approval for FSD (Supervised) on June 9, allowing over-the-air updates starting June 10. While still a Level 2 system requiring driver attention, the approval marks tangible progress in Tesla’s European autonomous driving ambitions. Wolfe Research raised its 2026 EPS estimate to $1.89 but trimmed the 2027 forecast to $2.04, citing higher depreciation and operating costs. The firm remains at Peerperform.
The double-digit intraday swing underscores Tesla’s sensitivity to both autonomous driving catalysts and macro risk appetite, leaving investors weighing near-term headwinds against a long-term vision centered on software, robotaxi services, and humanoid robotics.
