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Elon Musk’s vow to hold on to Tesla stock fails to soothe investors

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Tesla Inc shares touched a fresh two-year low in volatile trading on Friday as boss Elon Musk’s promise to not sell his shares for at least two years did little to reassure investors.

Musk has offloaded shares worth $40 billion in the world’s most valuable carmaker since late last year, with $15 billion of that coming after he made similar promises not to sell in April.

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That, along with concerns about his distraction with newly bought Twitter and a slowdown in China’s economy, have set the electric-car maker’s shares on course for their worst year since going public in 2010.

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The stock was last up 2% on Friday, recovering from a fall of as much as 3.5% earlier in the session, its lowest since September 2020.

“I won’t sell stock until I don’t know probably two years from now. Definitely not next year under any circumstances and probably not the year thereafter,” Musk said on Thursday.

“If this was another CEO of a Fortune 500 company making that statement, market would be confident that ‘he said it, so he’s not selling’,” said Dennis Dick, head trader and market structure analyst at Triple D Trading.

Known for tweeting about his plans extensively, Musk most recently asked in a Twitter poll if he should quit as the head of Twitter. In 2018, he got into trouble with regulators over a tweet about taking Tesla private.

“Musk looks rattled, vowing not to sell more stock and floating the idea of share buybacks. Short-sellers are firmly in control and there is a lot of hesitation by retail to buy this dip,” said Edward Moya, senior market analyst at OANDA. (Reporting by Medha Singh, Srishti Achar and Chavi Mehta in Bengaluru; additional reporting by Nivedita Balu in Bengaluru; Editing by Devika Syamnath)

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