Investors are rewarding U.S. automakers as they embrace electric vehicles to boost growth amid a burgeoning demand for environment-friendly cars.

Tesla Inc. was among the biggest drags on the S&P 500 in its first day of trading on the benchmark.

Tesla Inc. is smashing through records as its impending addition to the S&P 500 Index has sparked a buying frenzy among investors, pushing the company’s market valuation over the $500 billion mark for the first time on Nov. 24.

Electric vehicle startups extended their winning streak on Nov. 13, buoyed by strong earnings results from some of their peers and Joe Biden’s projected presidential win.

Both of the major-party presidential candidates have said they support electric vehicles, but a Joe Biden win could bring changes to significantly speed up the adoption of cars and trucks built by the likes of Tesla Inc. and Nikola Corp.

Tesla Inc. shares are now officially in correction territory, in a week that saw the electric-vehicle maker announce a share sale that could dilute its value and a top holder say it would cut its stake nearly in half.

Already plumped up by big rallies in 2020, stocks for Apple and Tesla popped again Aug. 31, surpassing record highs after the companies' stock splits took effect.

Wall Street’s optimistic view on Tesla Inc. further solidified Aug. 26 after a Jefferies analyst more than doubled his price target on the stock, saying the company will continue to broaden its competitive edge in multiple dimensions, including battery capacity and industrial efficiency.

The relentless rally in Tesla Inc. shares has driven its valuation close to the consumer product behemoth Procter & Gamble Co. as investors bet on the electric vehicle maker’s ability to dominate the automotive market of the future.

Tesla Inc.’s soaring valuation led to a downgrade by Sanford C. Bernstein analyst Toni Sacconaghi on July 28, who said it is difficult to justify the market capitalization even using best-case scenarios.