Tesla Soars 12% in Rare Rally – Short Squeeze or Fundamental Rebound?

TradingKey - Tesla (TSLA) surged nearly 12% amid a broad market rally, but can the momentum last?  

On Monday, U.S. stocks rallied across the board, with the three major indices gaining over 1%. Tech giants like Nvidia (NVDA), Amazon (AMZN), and Meta rose more than 3%, while Tesla(TSLA) outperformed with a staggering 12% jump.  

Tesla Stock Price Chart, Source: Google.

The rally was largely driven by shifting U.S. tariff policies. Former President Trump signaled a more targeted approach to "reciprocal tariffs" set for April 2, hinting at potential tariff reductions for multiple countries. This eased market fears that escalating trade wars could worsen inflation and hurt economic growth.  

Additionally, the FBI formed a special task force to investigate threats against Tesla following a series of attacks. CEO Elon Musk's political alignment with Trump has drawn backlash, raising concerns about Tesla's sales.  

Tariff uncertainties and Musk-related controversies have weighed heavily on Tesla's stock this year. If these issues stabilize, fundamentals could improve, supporting further gains. Otherwise, the rebound may prove short-lived.