US markets closed lower as Tesla’s Investor Day failed to excite

Key US equity markets closed lower overnight after another round of hawkish Fed Speak and higher-than-expected German inflation combined to send US two-year yields to a fresh cycle high of 4.90%.

Unsurprisingly, in an environment of higher interest rates and inflation concerns, the Nasdaq was the worst-performing index falling -0.87%.

However, this masked a brutal session for EV makers.

Following the disappointing earnings reports this week, Rivian fell 18.34%, Workhorse fell 14.81% to $1.76 and Nio fell 5.96%.

Tesla fell by 1.43% to $202.77, holding its ground ahead of its highly anticipated Investor Day, which kicked off shortly after the market closed.

What has the Tesla Investor Day unveiled?

The Tesla Investor Day is underway at the company's Austin, Texas, Gigafactory. Tesla CEO Elon Musk has outlined that the next phase of Tesla's growth, or Master Plan 3, will be built around sustainable energy and has reiterated that "all cars will be fully electric and autonomous."

Musk spooked investors when he stated that his Master Plan 3 for sustainable energy would require an investment of $10 trillion causing Tesla shares to fall 5.5% in after-hours trading to $191.60.

At this point, no new car has been announced, disappointing some who were looking for Tesla to bring a more affordable vehicle to the market.

In other news, Tesla confirmed that the development of its lithium refinery in Corpus Christi, Texas was underway and simultaneously announced that Tesla’s next vehicle assembly plant will be in Mexico near Monterrey.

“We’re super excited about it,” Musk said during the Investor Day event. “We’ll continue to expand production at all of our existing factories. So this is not moving output to anywhere, from anywhere. This is supplemental production.”

Tesla technical analysis

Following its earnings report on January 25, Tesla's share price surged over 50%, from $144 to a high of $217.65. Since then, its share price has been in a holding pattern, consolidating recent gains below the resistance from the 200-day moving average at $221.20 and above support near $190.

If the Tesla share price were to see a sustained break above $221, it would indicate that the rally from the January $101.83 low has started its next leg higher towards the $314 double high from August/September 2022.

Until then, we look for more sideways to corrective price action with scope back towards support at $175.00.

Tesla daily chart