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Shares of electric-vehicle maker Tesla are rallying Wednesday on no official news. It’s likely bearish investors trying to manage their bets against Tesla stock.
Ina Fassbender/AFP via Getty Images
Tesla
stock is up a lot in Wednesday trading. There isn’t any big news, beyond a disappointing delivery number that arrived Monday morning. So investors are asking: What gives?
Tesla stock (ticker: TSLA) is up 3.7% at $255.57 in midday trading, while the
S&P 500
and
Nasdaq Composite
were up 0.3% and 0.7%, respectively.
Shares are about 2% since electric-vehicle maker reported third-quarter deliveries of about 430,000 units, missing Wall Street’s consensus estimate by some 25,000 vehicles. Still, investors seemed braced for a weak result. Headed into the delivery number, Tesla stock had dropped about 14% since the company reported second-quarter results. On the second-quarter-earnings conference call, management told investors third-quarter production would be down because of planned maintenance.
It appears that most of the bad news from a weak delivery number was already in the stock. Bears might not have thought so and, as a result, might have sowed the seeds of the post-delivery rally themselves. Short interest in Tesla stock was edging up into the delivery number, by about 7 million shares, according to Bloomberg.
Short sellers bet on price declines by borrowing shares and selling them, with the expectation shares can be bought cheaper later, and returned to the lender. It’s a bearish position. Short interest is essentially the total number of…
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