Why Tesla, Toyota, and Indie Semiconductor Rallied Today

Shares of auto leaders Tesla (NASDAQ: TSLA) and Toyota Motor (NYSE: TM), as well as auto-centered semiconductor stock Indie Semiconductor (NASDAQ: INDI) were rallying on Thursday, up 7.3%, 4.3%, and 3.5%, respectively, as of 2:14 p.m. ET.The main driver for the rise in auto-related stocks today was the Federal Reserve's 50-basis-point cut to the federal funds rate late yesterday. Here's why that news was so important to autos, and why the sector is surging today -- especially electric vehicle (EV)-related stocks.Auto-related stocks have been punished this year as high interest rates have depressed growth. A vehicle is a big-ticket item, so many autos are financed. Hence the sensitivity to interest rates. Electric vehicle stocks have been especially depressed as higher rates made EVs -- which are generally higher-priced than their internal combustion engine (ICE) competitors -- less affordable. Given that auto companies concentrated on EVs had come into this period with higher valuation multiples, it's no surprise many declined over the past two years.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool