President Donald Trump and Tesla CEO Elon Musk are in the midst of a public feud as Tesla’s stock reaches records lows.
Tesla’s stock sank nearly 15 percent Thursday as the friendship between Elon Musk and President Trump explodes and results in threats and a war of words.
The fallout began earlier this week when Musk publicly slammed the GOP’s new tax-and-spending bill, calling it a “disgusting abomination.” The legislation has drawn criticism for potentially affecting clean energy incentives such as the $7,500 electric vehicle tax credit, an incentive that has helped fuel Tesla’s growth.
By Wednesday, Musk had intensified his opposition, urging his millions of followers on X to pressure lawmakers. “Call your Senator, Call your Congressman,” he posted. “Bankrupting America is NOT ok! KILL the BILL.”
“I’m very disappointed, because Elon knew the inner workings of this bill better than almost anybody sitting here, better than you people,” Trump told reporters in the Oval Office on Thursday. “All of a sudden, he had a problem, and he only developed the problem when he found out that we’re going to have to cut the EV mandate.”
The administration is reportedly weighing whether to revoke EV subsidies entirely and is considering canceling federal contracts with Musk-led companies, including Tesla and SpaceX, moves that could dramatically affect Musk’s business empire.
That led Musk to claim he was the reason Trump won in 2024 and sparked a war of the words that ended with Tesla stock tanking by closing bell. It finished down early 15 percent and now sits at 284.70 a share.
U.S. stocks dipped on Thursday before a key jobs report is expected. The S&P 500 dropped 0.5%, marking its first decline in four days, amid concerns over job market stability and ongoing tariff discussions. Major declines were noted in companies like Tesla and Brown-Forman, though there were bright spots such as MongoDB, which rose significantly after exceeding profit expectations.
U.S. stocks generally drifted lower on Thursday as investors made their final adjustments before the much-anticipated jobs report from the Labor Department set for Friday. The S&P 500 ended the day down 0.5%, marking its first decline in four days. This drop follows a strong rally earlier in the month, although the index is still hovering close to its all-time high.
The Dow Jones Industrial Average fell by 108 points, or 0.3%, while the Nasdaq composite faced a bigger downturn of 0.8%. Trading in options markets indicates a significant move for the S&P 500 could happen tomorrow when the employment figures, reflecting how many jobs were added in May, are released. Most expect a slowdown in job creation from April levels.
The resilience of the job market has been a critical factor supporting the U.S. economy. However, uncertainties arising from President Donald Trump’s inconsistent tariff policies may cause companies to halt hiring. A report earlier this week revealed that more American workers applied for unemployment benefits than analysts had predicted, marking an eight-month high yet still relatively low in historical context.
In corporate news, Procter & Gamble announced it would cut up to 7,000 jobs over the next two years, leading to a 1.9% drop in its stock. Tesla was another significant market mover, plummeting 14.3% as it faced losses approaching 30% for the year amidst growing tensions between its CEO Elon Musk and President Trump over tax policies.
Brown-Forman, known for Jack Daniel’s whiskey, saw its stock plunge 17.9%, the worst performance since it began trading in 1972, after their quarterly earnings fell short of expectations. CEO Paul Varga noted that they foresee significant challenges ahead positioned against “consumer uncertainty” and ongoing tariff discussions. Similarly, PVH Corp. reported substantial revenue that exceeded forecasts but took a heavy hit, with its shares falling 18%.
Wall Street had hoped for tariff reductions following positive remarks from Trump about a phone call with Chinese leader Xi Jinping, signifying a potential easing of trade tensions. The optimism remains cautious, though, as prior accusations concerning tariff violations lingered in the background.
On a brighter note, MongoDB shares surged 12.8% after outperforming profit expectations. Additionally, Circle Internet Group, which deals in cryptocurrency, had a remarkable debut on the New York Stock Exchange, soaring 168.5%. Five Below also gained 5.6% as the retailer reported stronger earnings thanks to broad strength across its product line, a feat credited by CEO Winnie Park.
Overall, the S&P 500 dropped 31.51 points, closing at 5,939.30. The Dow finished down 108 points at 42,319.74, and the Nasdaq composite ended the session at 19,298.45, down 162.04 points. In the bond market, Treasury yields remained stable, with the 10-year Treasury yield rising slightly to 4.40% from 4.37%. Markets overseas were mixed, with European indexes reflecting modest changes following the European Central Bank’s anticipated interest rate cuts. Asia saw more significant movement, particularly in South Korea, where the Kospi index jumped 1.5% after the inauguration of liberal president Lee Jae-myung, who promised to renew discussions with North Korea and strengthen U.S. ties.