Shares of Tesla (NASDAQ: TSLA) are climbing on Thursday. The electric vehicle (EV) maker’s stock gained 4.1% as of 3:20 p.m. ET and was up as much as 4.9% earlier in the day. The rise comes as the S&P 500 gained 1.1% and the Nasdaq Composite rose 1.8%.
The company’s stock is seeing a boost after President Donald Trump announced a trade agreement with the United Kingdom.
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The first deal
Tesla shares climbed after Trump unveiled the broad outline of a trade agreement with the United Kingdom. This is the first major deal his administration has been able to put together after Trump imposed sweeping tariffs in April. It’s important to note that many specifics remain unclear, and nothing was formally signed. “The final details are being written up,” Trump said. “In the coming weeks, we’ll have it all very conclusive.”
And while optimism is high following the announcement, the tentative deal as of yet does not include the lowering of the U.K.’s 10% tariff on U.S. automobiles. Still, it left the door open for these to be lowered as well as capping the number of vehicles the country can effectively sell into the U.S. This appeared to be enough for investors to send shares higher.
Image source: Getty Images.
The future is uncertain
The announcement comes at a critical time for Tesla. The company has seen its sales plummet across key markets — including the U.K. — even as EV sales at large are on the rise. In the company’s recent earnings call, Tesla chief Elon Musk said he would devote more time to his duties as CEO after investor discontent grew from his role in the Trump administration. Despite Musk’s return, I continue to think the stock is overvalued.
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Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.
