Trump-Musk Induced Tesla Slide Points to Market Risks From Massive Stocks

Tesla’s decline points to the risk that many investors have long warned about, of indexes being heavily influenced by a handful of megacap stocks.

A screen shows Tesla CEO Elon Musk and U.S. President Donald Trump, as a futures-options trader works on the floor of the the New York Stock Exchange (NYSE) in New York City on May 30, 2025. Jeenah Moon/REUTERS

NEW YORK—The rift between President Donald Trump and Tesla chief Elon Musk has captivated the world as a political drama, but it has also become a Wall Street spectacle, highlighting the risk to equity markets from the world’s biggest stocks.

Tesla shares slid 14 percent on Thursday as Musk and Trump feuded largely on social media, including the president threatening to cut off government contracts to Musk’s companies.