Tesla Stock Slump Reflects Broader Tech Pressure Amid Rate Cut Uncertainty

Tesla shares have tumbled roughly 9% since Elon Musk secured his controversial $1 trillion compensation package, with the stock breaking through what many analysts considered a key support level at $400. The decline mirrors wider pressures across the tech sector as fading expectations for Federal Reserve rate cuts drain momentum from risk assets.

Market dynamics reveal a dual assault on tech valuations. Rising Treasury yields are triggering capital rotations out of growth stocks, while waning enthusiasm for artificial intelligence plays compounds the selling pressure. "When the tide goes out on speculative growth stories, even category leaders like Tesla face headwinds," observes one portfolio manager, speaking on condition of anonymity.

Morgan Stanley's Adam Jonas maintains a contrarian stance, projecting breakthroughs in Tesla's autonomous driving technology by 2026 could redefine the investment thesis. His research suggests robotaxi deployments without safety drivers may commence in Texas within two years—a potential inflection point the market currently discounts.