Tesla stock climbs 3% as Musk heads to China amid FSD expansion push

Shares of Tesla TSLA rebounded sharply on Wednesday, climbing around 3% as investors quickly moved past the previous session’s selloff and refocused on the company’s autonomous driving ambitions.

The recovery followed Tuesday’s roughly 3% decline and extended a broader rally that has lifted Tesla shares nearly 10% over the past week.

The gains came despite broader market weakness after another hotter-than-expected inflation reading pushed Treasury yields to 10-month highs.

The Dow Jones Industrial Average fell 0.4%, while the S&P 500 slipped 0.1%.

The Nasdaq Composite managed a modest 0.1% gain, supported partly by continued strength in technology and semiconductor shares.

China FSD approval hopes lift sentiment

One of the biggest catalysts behind Tesla’s rebound was renewed optimism that Chinese regulators may be nearing approval for the company’s Full Self-Driving software.

FSD remains central to Tesla’s long-term valuation strategy, with investors increasingly viewing the company less as a traditional automaker and more as an artificial intelligence and robotics business.

In the United States, Tesla charges $99 per month for FSD subscriptions.

The company disclosed in April that FSD subscriptions reached approximately 1.3 million at the end of the first quarter, up from roughly 850,000 a year earlier.

A launch in China would significantly expand the addressable market for Tesla’s software business and represent a major milestone in the company’s efforts to monetize autonomous driving technology globally.

Investor attention also intensified after Chief Executive Elon Musk confirmed he was traveling to China aboard Air Force One as part of US President Donald Trump’s delegation.

The trip includes several prominent U.S. business leaders, including Jensen Huang, Tim Cook, Larry Culp, Kelly Ortberg, and Jane Fraser.

China remains one of Tesla’s most strategically important markets, particularly for future autonomous driving and software revenue growth.

Belgium authorizes Tesla FSD testing

Tesla also received another regulatory boost in Europe after Belgian authorities authorized supervised testing of the company’s self-driving software in the Flanders region.

According to officials, Tesla can begin testing as soon as the company secures a local license plate and insurance approval.

The tests are expected to cover roughly 5,000 kilometers and will evaluate how the software performs under Belgian traffic rules and road infrastructure conditions.

Officials indicated that positive test results could accelerate efforts toward broader provisional European approval.

The authorization is valid across Belgian territory and marks another incremental step in Tesla’s broader push to expand FSD adoption internationally.

Analyst on Tesla stock

Separately, Barclays reiterated its Equalweight rating on Tesla with a $360 price target following the company’s plans to expand battery-cell production capacity at its Berlin facility.

Tesla plans to increase production capacity from the previously announced 8 gigawatt hours to levels capable of supporting more than 250,000 Model Y vehicles annually.

Barclays said the move could reflect improving demand conditions in Europe.

The company currently assembles battery packs in Berlin using imported cells, including Tesla’s own 4680 battery technology manufactured in the United States.