Tesla value jumps $40 billion as S&P 500 beckons

(Reuters) – Shares of Tesla Inc rose as much as 12% on Tuesday, adding more than $40 billion to the value of the electric carmaker and giving another boost to the fortune of billionaire Chief Executive Officer Elon Musk.

S&P Dow Jones Indices confirmed after markets closed on Monday that the company would be added to Wall Street’s main index from Dec. 21, firing the starting gun on a major reorganization of investment funds that track the basket of stocks.

At $400 billion or more, Tesla’s market capitalization should amount to more than 1% of the total value of the companies listed on the S&P 500, potentially making it the biggest ever addition to the index.

S&P DJI said on Monday the addition would require the funds tracking the index to sell about $51 billion worth of shares from their current holdings to buy Tesla shares and rebalance their portfolios in line with the index.Reuters News

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