Tesla Shares Jump to Record High ahead of S&P 500 Debut

A logo of Tesla Motors on an electric car model is seen outside a showroom in New York June 28, 2010. (Reuters)
A logo of Tesla Motors on an electric car model is seen outside a showroom in New York June 28, 2010. (Reuters)
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Tesla Shares Jump to Record High ahead of S&P 500 Debut

A logo of Tesla Motors on an electric car model is seen outside a showroom in New York June 28, 2010. (Reuters)
A logo of Tesla Motors on an electric car model is seen outside a showroom in New York June 28, 2010. (Reuters)

Shares of Tesla Inc rose to a record high on Friday in a frantic day of trading as investors geared up for the electric carmaker’s much anticipated entrance into the benchmark S&P 500 index.

The company headed by billionaire Elon Musk on Monday will become the most valuable ever admitted to Wall Street’s main benchmark, accounting for over 1% of the index. The shares have surged some 70% since mid-November, when its debut in the S&P 500 was announced, and have soared 700% so far in 2020.

Tesla’s shares ended up 6% at a record $695.

Tesla’s addition to the S&P 500 is forcing index-tracking funds to buy about $85 billion worth of the shares by the end of Friday’s session so that their portfolios reflect the index, according to S&P Dow Jones Indices. Those funds simultaneously have to sell other S&P 500 constituents’ shares worth the same amount.

Shares swung between gains and losses late in the session before surging in price and volume near the end of trading.

The move was likely a result of last-minute buying in preparation for its addition to the S&P 500, said Dennis Dick, proprietary trader at Bright Trading in Las Vegas.

Turnover in Tesla shares topped $120 billion shortly after 4 pm EST (2100 GMT), with volume exceeding 200 million as the stock traded after hours, according to Refinitiv data. Trading volume for Tesla has averaged 53 million shares over the past 10 sessions.

“That kind of volume is just sort of insane,” Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas, said of Friday’s action.

Tesla shares were falling in after-hours trading, last down 3%.

Tesla’s inclusion may be a double-edged sword for index trackers, who are buying its volatile shares after this year’s massive run-up.

“Index-based funds will be paying a higher price than those that bought the stock when the entry date was announced, but will benefit as the fund better represents the US large-cap universe,” said Todd Rosenbluth, head of ETF and mutual fund research at CFRA. “Tesla’s absence in the prominent index has been notable in 2020.”

Some strategists expect Tesla’s inclusion to ripple through the S&P 500 itself. Tesla is a “volatile stock,” noted Lindsey Bell, chief investment strategist with Ally Invest, moving an average of 4.1% a day in 2020.

Others, however, say Tesla’s addition is unlikely to exacerbate gyrations in the broader index. Had the stock been included in the S&P 500 all year, it would have increased implied volatility on the benchmark index by only a small amount, according to a study by UBS strategist Stuart Kaiser.

Actively managed funds that benchmark their performance against the S&P 500, many of which until now have avoided investing in one of Wall Street’s most controversial stocks, will also be forced to decide whether to own Tesla.

“Everyone has known this is coming for two or three weeks, so the real question now is if it continues to be an outperformer and, if so, then what is the catalyst,” said Thomas Hayes, managing member at Great Hill Capital LLC in New York.

California-based Tesla’s stock surge has put its market value at about $660 billion, making it the sixth most valuable publicly listed US company with many investors viewing it as wildly overvalued.

Tesla is by far the most traded stock by value on Wall Street, with $18 billion worth of its shares exchanged on average in each session over the past 12 months, easily beating Apple, in second place with average daily trades of $14 billion, according to Refinitiv.

About a fifth of Tesla’s shares are closely held by Musk, the chief executive, and other insiders. Since the S&P 500 is weighted by the amount of companies’ shares actually available on the stock market, Tesla’s influence within the benchmark will be slightly diminished compared with its overall value.



IMF and Arab Monetary Fund Sign MoU to Enhance Cooperation

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
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IMF and Arab Monetary Fund Sign MoU to Enhance Cooperation

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA

The International Monetary Fund (IMF) and the Arab Monetary Fund (AMF) signed a memorandum of understanding (MoU) on the sidelines of the AlUla Conference on Emerging Market Economies (EME) to enhance cooperation between the two institutions.

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki, SPA reported.

The agreement aims to strengthen coordination in economic and financial policy areas, including surveillance and lending activities, data and analytical exchange, capacity building, and the provision of technical assistance, in support of regional financial and economic stability.

Both sides affirmed that the MoU represents an important step toward deepening their strategic partnership and strengthening the regional financial safety net, serving member countries and enhancing their ability to address economic challenges.


Saudi Chambers Federation Announces First Saudi-Kuwaiti Business Council

File photo of the Saudi flag/AAWSAT
File photo of the Saudi flag/AAWSAT
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Saudi Chambers Federation Announces First Saudi-Kuwaiti Business Council

File photo of the Saudi flag/AAWSAT
File photo of the Saudi flag/AAWSAT

The Federation of Saudi Chambers announced the formation of the first joint Saudi-Kuwaiti Business Council for its inaugural term (1447–1451 AH) and the election of Salman bin Hassan Al-Oqayel as its chairman.

Al-Oqayel said the council’s formation marks a pivotal milestone in economic relations between Saudi Arabia and Kuwait, reflecting a practical approach to enabling the business sectors in both countries to capitalize on promising investment opportunities and strengthen bilateral trade and investment partnerships, SPA reported.

He noted that trade between Saudi Arabia and Kuwait reached approximately SAR9.5 billion by the end of November 2025, including SAR8 billion in Saudi exports and SAR1.5 billion in Kuwaiti imports.


Leading Harvard Trade Economist Says Saudi Arabia Holds Key to Success in Fragmented Global Economy

Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
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Leading Harvard Trade Economist Says Saudi Arabia Holds Key to Success in Fragmented Global Economy

Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).

Harvard University economics professor Pol Antràs said Saudi Arabia represents an exceptional model in the shifting global trade landscape, differing fundamentally from traditional emerging-market frameworks. He also stressed that globalization has not ended but has instead re-formed into what he describes as fragmented integration.

Speaking to Asharq Al-Awsat on the sidelines of the AlUla Conference for Emerging Market Economies, Antràs said Saudi Arabia’s Vision-driven structural reforms position the Kingdom to benefit from the ongoing phase of fragmented integration, adding that the country’s strategic focus on logistics transformation and artificial intelligence constitutes a key engine for sustainable growth that extends beyond the volatility of global crises.

Antràs, the Robert G. Ory Professor of Economics at Harvard University, is one of the leading contemporary theorists of international trade. His research, which reshaped understanding of global value chains, focuses on how firms organize cross-border production and how regulation and technological change influence global trade flows and corporate decision-making.

He said conventional classifications of economies often obscure important structural differences, noting that the term emerging markets groups together countries with widely divergent industrial bases. Economies that depend heavily on manufacturing exports rely critically on market access and trade integration and therefore face stronger competitive pressures from Chinese exports that are increasingly shifting toward alternative markets.

Saudi Arabia, by contrast, exports extensively while facing limited direct competition from China in its primary export commodity, a situation that creates a strategic opportunity. The current environment allows the Kingdom to obtain imports from China at lower cost and access a broader range of goods that previously flowed largely toward the United States market.

Addressing how emerging economies should respond to dumping pressures and rising competition, Antràs said countries should minimize protectionist tendencies and instead position themselves as committed participants in the multilateral trading system, allowing foreign producers to access domestic markets while encouraging domestic firms to expand internationally.

He noted that although Chinese dumping presents concerns for countries with manufacturing sectors that compete directly with Chinese production, the risk is lower for Saudi Arabia because it does not maintain a large manufacturing base that overlaps directly with Chinese exports. Lower-cost imports could benefit Saudi consumers, while targeted policy tools such as credit programs, subsidies, and support for firms seeking to redesign and upgrade business models represent more effective responses than broad protectionist measures.

Globalization has not ended

Antràs said globalization continues but through more complex structures, with trade agreements increasingly negotiated through diverse arrangements rather than relying primarily on multilateral negotiations. Trade deals will continue to be concluded, but they are likely to become more complex, with uncertainty remaining a defining feature of the global trading environment.

Interest rates and artificial intelligence

According to Antràs, high global interest rates, combined with the additional risk premiums faced by emerging markets, are constraining investment, particularly in sectors that require export financing, capital expenditure, and continuous quality upgrading.

However, he noted that elevated interest rates partly reflect expectations of stronger long-term growth driven by artificial intelligence and broader technological transformation.

He also said if those growth expectations materialize, productivity gains could enable small and medium-sized enterprises to forecast demand more accurately and identify previously untapped markets, partially offsetting the negative effects of higher borrowing costs.

Employment concerns and the role of government

The Harvard professor warned that labor markets face a dual challenge stemming from intensified Chinese export competition and accelerating job automation driven by artificial intelligence, developments that could lead to significant disruptions, particularly among younger workers. He said governments must adopt proactive strategies requiring substantial fiscal resources to mitigate near-term labor-market shocks.

According to Antràs, productivity growth remains the central condition for success: if new technologies deliver the anticipated productivity gains, governments will gain the fiscal space needed to compensate affected groups and retrain the workforce, achieving a balance between addressing short-term disruptions and investing in long-term strategic gains.