Tesla stock jumps 10% after trading halt

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Dan Primack of Axios tweets: "One of two things is true right now: Elon Musk has quietly pulled a huge coup, and secured enough financing to buy his company at a premium. 2".

No matter if he was joking or not, as soon as Musk tweeted about this, the stock spiked.

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Unlike publicly listed companies, private firms do not have to share details of their finances and operations.

Tesla reported its biggest quarterly loss ever last week, saying in its second-quarter earnings report that the carmaker lost more $717 million on $4 billion in revenue.

In a public letter posted to Tesla's official website, Musk elaborated on his intentions to privatize Tesla - at least in the short-term.

The most obvious equity partners for Musk would be a sovereign wealth fund such as Saudi Arabia's Public Investment Fund (PIF) or major technology investment funds such as SoftBank Group Corp's Vision Fund, bankers said.

For example, one block of 714 Tesla call options, betting on the shares rising above US$365 by the end of the week, were bought for 85 cents, for a total outlay of US$60,690 on Tuesday.

George Galliers of Evercore ISI said he believed the tweet was serious.

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Mr Musk has been under intense pressure this year to prove he can deliver on his promise to turn his money-losing company into a profitable higher-volume manufacturer.

Short sellers. These are the traders betting on the price of Tesla shares going down. Trading was halted for an hour and a half Tuesday afternoon, as The New York Times reports, but when it resumed shares jumped to $367 - an increase of 16 percent since the Q2 earnings call on August 1.

"Am considering taking Tesla private at $420".

"He originally brought Tesla public in 2010, given he could no longer personally finance its growth, and has continually expressed his frustration with the company being public".

At that price, the buyout would cost almost $US72 billion, based on Tesla's outstanding stock as of July 27, but it is unlikely the deal would cost that much because Mr Musk owns a roughly 20 per cent stake in the Palo Alto, California, company.

"As the most shorted stock in the history of the stock market, being public means that there are large numbers of people who have the incentive to attack the company", Musk said. Musk said he will ensure the prosperity of shareholders "in any scenario".

Still, the tech-heavy NASDAQ exchange where Tesla is listed halted trading over the uncertainty of whether Musk's tweet may have violated any Securities and Exchange Commission rules that prevent company executives from making market-moving statements.

Taking Tesla private would be an extreme albeit effective way of muting Tesla's bears, according to Michael O'Rourke, chief market strategist at JonesTrading.

"His mission for Tesla (to accelerate the globe's adoption of sustainable energy) is both grand and long-term, making it hard to accommodate investors quarterly expectations", he wrote.