Tesla share value  sinking below the price at which it entered the S&P500 index

Tesla Inc.’s shares wiped out their year-to-date gains and traded below the level where they were when the electric-carmaker entered the S&P 500 Index in December.

The stock dropped as much as 13 percent to $619 in New York, its biggest intraday decline since Sept. 8, before paring much of the loss to trade down. The stock was down 31 percent from its Jan. 25 record intraday high at its lowest point on 23 February.

Tesla’s mid-February decline amid a wider market selloff was fueled in part by Chief Executive Officer Elon Musk’s comments over the weekend that the prices of Bitcoin and smaller rival Ether “do seem high.”

“Tesla is an EV play entering the golden age of EVs and there is a lingering worry that the Bitcoin sideshow could overshadow the overall EV growth story playing out for Tesla in 2021 and beyond,” Wedbush analyst Daniel Ives wrote in a note to clients.

The concerns over the value of the cryptocurrency helped erase some of Bitcoin’s gains, which had rocketed to new highs after Tesla announced some weeks ago it added USD 1.5 billion in Bitcoin to its balance sheet. The cryptocurrency fell as much as 18 percent to $45,000.

However, other recent factors may also be taking the shine off Tesla’s valuation. The company’s decision to stop taking orders for the lowest-priced version of its Model Y electric SUV, as reported by Electrek, may also be dampening investor enthusiasm. 

Tesla stopping sales of its lowest price Model Y coupled with continued price cuts have led to Street demand concerns as the bears come out of hibernation mode.

Besides, a continuous stream of EV development news from traditional automakers such as General Motors Co. and Ford Motor Co., as they prepare to go all-in on the electrification race, have emphasized that Tesla isn’t the only way to get exposure to the upcoming transformation in the auto sector.

Smaller electric-vehicle stocks, which typically take their daily trading cues from Tesla, also dropped sharply.

Likewise, shares of Tesla Inc. TSLA, -0.99 percent dropped 0.99 percent to  USD 675.50 on February 26, on what proved to be an all-around mixed trading session for the stock market, with the NASDAQ Composite Index COMP, +0.56 percent rising 0.56 percent to 13,192.34 and the Dow Jones Industrial Average DJIA, -1.50 percent falling 1.50 percent to 30,932.37. This was the stock’s second consecutive day of losses. Tesla Inc. closed  USD 224.90 below its 52-week high (USD 900.40), which the company reached on January 25th.

Representations of virtual currency Bitcoin are seen in front of Tesla logo in this illustration taken, February 9, 2021. REUTERS/Dado Ruvic/File Photo