Tesla Motors Inc (TSLA) Price Drop After Fire 'Perfectly Irrational':
"...back in August when the Tesla Motors Inc (NASDAQ:TSLA) Model S received five stars in every category from the National Highway Traffic Safety Administration, pushing its stock price up 2 percent.
Then on October 1 a driver ran over a metal object that punctured the car’s battery, starting a fire and forcing the driver to pull over and flee the vehicle, and stock prices fell 10 percent over the next two days.
On October 4, Tesla Motors Inc CEO Elon Musk explained that the car had alerted the driver that there was a problem, that no one was hurt, and that gas cars also catch fire from time to time, pushing stock prices back up 3 percent.
The bad news had a bigger impact than either positive news story. “From a psychological perspective, this overreaction... is nothing new. It is a consistent way that we react to salient news, and it is perfectly irrational "
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