Tesla value jumps US$40 bil as S&P 500 beckons

The logo of Tesla is seen at a Tesla Supercharger station in Dietikon Switzerland

Tesla, the world's most valuable vehicle manufacturer worth $400bn (£300bn), is set to join the S&P 500 index on December 21. Stocks jumped in after hours trading as money managers that track the S&P 500 clambered to add Tesla to portfolios.

Tesla is now the world's most valued auto company, and the news has already led to Tesla's shares running up more than 14% in after-hours trading, with the shape of the graph suggesting Tesla is very likely to beat its $500 record from earlier this year.

At $400 billion, Tesla's market capitalization is a hundred times that of the S&P's smaller companies, according to Refinitiv data, and potentially making it the biggest ever addition to the index.

Funds indexed to the S&P 500 will have to sell about $151 billion in shares in other S&P 500 companies and use those funds to buy TSLA stock.

As a result, the index is "seeking feedback through a consultation to the investment community to determine if Tesla should be added all at once on the rebalance effective date, or in two separate tranches", S&P Dow Jones Indices said. Additionally, based on its market value, Tesla would be one of the top 10 companies in the benchmark index upon entry.

More recent developments - the unveiling of Tesla's long term battery plan, and the roll-out of its "fully functional" Full Self Driving beta to select drivers - have not yet gained traction n in market value terms, as investors cautiously wait to see both new technologies come to full fruition. Tesla will account for about one percent of the index.

In 1999, Yahoo surged 64% in five trading days between the announcement that it would be added to the index and its inclusion. Shares popped more than 12% at Tuesday's opening bell.



Latest news

Spain coach Enrique tight-lipped over keeper choice before Germany showdown
Morata meanwhile took pleasure in silencing Spain's critics after they snatched a 1-1 draw away to Switzerland on Saturday. We have a group of 30 players who perform very well.

Need to hold countries supporting terror accountable: PM Modi at BRICS
The Prime Minister also highlighted reform initiatives undertaken by his government under the "self-reliant India" campaign. We have to make sure that countries that shelter terrorists and support them are also held responsible.

Trump fires election security official who contradicted him
Trump announced Krebs' firing in a series of tweets , singling out a recent statement he made about election security. Election Assistance Commission and the National Association of State Election Directors, among others.

Covid: Mouthwash 'can kill virus in lab in 30 seconds'
The BBC reports the United Kingdom study has been submitted for publication in a journal to be reviewed by other scientists. A United Kingdom study has revealed that mouthwash can kill COVID-19 within 30 seconds of exposure in a laboratory.

Immortals Fenyx Rising Season Pass Reveals 3 Pieces of Post-Launch Content
Those who own the Season Pass as part of the Gold Edition will also get a bonus quest - When the Roads Get Rocky , from launch. Myths of the Eastern Realm is set in Chinese Mythology and introduces a new hero called Ku.

Other news