Electric Vehicle Stocks Plummet, Seohak Ants 'Restless'

Rivian Down 24% · Tesla Down 22%
Sharp Decline in US Nasdaq Market Over One Month

[Asia Economy Reporter Minji Lee] Overseas investors known as Seohak Gaemi, who have ventured into foreign stock investments, are dismayed as the decline in electric vehicle (EV) stocks, which they had heavily invested in, accelerates. In particular, Tesla, a leading American electric vehicle company, has been the most purchased "favorite stock" by domestic investors this month, suggesting that investors have likely incurred significant short-term losses.

On the 21st, Tesla closed at $899.94 on the Nasdaq market, down 3.5% from the previous trading day. This marks a drop back to the $800 level after about two months, with a one-month price decline rate of 22.2%. Emerging EV companies Rivian and Lucid also showed steep declines. Both stocks plunged 7% and 5% respectively compared to the previous day, with one-month drops of 24% and 26%. Rivian, following a 10% drop the previous day, extended its decline to hit its lowest point since its listing on the 10th of last month.

As the spread of the Omicron variant, which seemed to be calming, intensifies, the likelihood of economic activity restrictions in major U.S. regions and European countries has increased. This has added to the burden felt by global stock markets, which were already under downward pressure due to tightening policies in major countries. Additionally, Rivian's guidance released the previous day, forecasting short-term poor performance due to weak results and chip shortages, significantly dampened investor sentiment toward the EV sector. Kang Daeseok, a researcher at Eugene Investment & Securities, explained, "With the strengthening of lockdown measures in major countries, rebalancing demand to adjust asset allocation due to price burdens on stocks that have risen significantly is continuing."

These EV companies have been steadily accumulated by Seohak Gaemi investors. Since last month, Tesla (?1.8654 trillion) ranked first in net purchases by overseas stock investors for the first time in about seven months, while Rivian (?313.1 billion) and Lucid (?281.7 billion) both made it into the top 10 net purchase stocks. As of the previous day, the combined custody balance of Tesla (?15.7953 trillion), Lucid (?1.1557 trillion), and Rivian (?229.4 billion) held by domestic investors totaled ?17.1412 trillion, exceeding the combined custody balance of four major tech stocks?Facebook (now Meta), Amazon, Apple, and Google?at ?11.55 trillion. A simple estimate suggests that Tesla investment funds may have evaporated by about ?3.5 trillion over the past month, with Lucid and Rivian losing approximately ?300 billion and ?55 billion respectively.

Securities experts predict that investor sentiment toward tech stocks will remain low for the time being as lockdowns are strengthened due to the spread of the Omicron variant. Park Seungjin, a researcher at Hana Financial Investment, said, "Concerns about prolonged supply chain disruptions and weakening consumer momentum due to the spread of COVID-19 will expand worries about fundamentals," adding, "For now, it is necessary to respond to low-volatility stocks, and large tech stocks are expected to show a rapid recovery when COVID-19 concerns ease."

This content was produced with the assistance of AI translation services.