Tesla stock extends rally as Musk-Trump alliance fuels gains

Tesla stock surges: Tesla shares extended last week's sharp rally with a jump of over 8 per cent on Monday, fueled by bets of automaker benefiting from CEO Elon Musk's close ties with US President-elect Donald Trump .

At $348.30, Tesla is expected to d nearly $87 billion to its value if gains hold. stock has jumped nearly 28 per cent since Trump's election victory was declared on Wednesday, surpassing $1 trillion in market value for first time in two years.

Tesla's year-to-date gains were just over 1 per cent before Trump secured his second term at White House.

Musk has been supporting Trump for months in hopes that his close ties to w President-elect would position his companies to benefit under new ministration, analysts have said.

billionaire contributed at least $119 million to a pro-Trump spending group, federal records show.

"As an 'efficiency Czar', Musk is likely to see this as an opportunity to sweep away red tape and streamline regulation", potentially helping his companies that are "at forefront of techlogical invation", said Susannah Streeter, he of money and markets at Hargreaves Lansdown.

From Tesla's electric vehicles to X rockets and Neuralink brain chips, Musk's business ventures depend heavily on government regulation, subsidies or policy.

Tesla's self-driving techlogy has been under scrutiny from safety regulators as Musk attempts to shift company's focus towards automous driving and robotaxis.

In September, Trump said he would establish a government efficiency commission heed by Musk to cut federal spending.

Musk's potential influence in government could be significant for his or ventures, such as Starlink broband system, owing to his role as a major contractor with US Department of Defense.

Streeter said claims of "preferential treatment" have potential to end up in court, but given litigation route is long and difficult, Musk's businesses have plenty of time to benefit.

Trump has also vowed to pare back certain EV incentives of Biden ministration, but startups are likely to take a bigger hit than Tesla because of automaker's heft in market, analysts have said.