Shares of Tesla Inc. TSLA, -8.55% tanked 6.0% in premarket trading Tuesday, which puts them on track to open about 24% below their record close. Many on Wall Street define a bear market as a decline of 20% or more on a closing basis from a significant peak. If Tesla’s stock closes below $706.47, which is 20% below the Jan. 26 record close of $883.09, the bear market would become official. The last time the stock entered a bear market was Sept. 8, 2020, when it closed at $330.21, or 33.7% below the then-record close of $498.32 on Aug. 31. The stock rose to a new record on Nov. 19. Tesla’s stock has still run up 36.9% over the past three months through Monday, while the S&P 500 SPX, -0.77% has gained 8.4%. Among Tesla’s electric vehicle peers, shares of China-based Nio Inc. NIO, -7.92% slumped 7.9% in premarket trading, after closing Monday 19.4% below its Feb. 9 record close of $62.84. The stocks of XPeng Inc. XPEV, -7.05% and Li Auto Inc. LI, -6.70% both fell into bear markets on Dec. 1, while Nikola Corp. shares NKLA, -2.06% closed Monday 73.8% below its record close of $79.73 on June 9, 2020.
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