Why Shares of Chinese electrical auto manufacturer Nio (NIO 0.44%) were toppling today?


Shares of Chinese electric auto manufacturer nio stock price today (NIO 0.44%) were tumbling today on relatively no company-specific information. Rather, investors may be reacting to news from yesterday that some parts of China were experiencing a surge in COVID-19 cases.

Much more lockdowns in the country might once again reduce the company‘s automobile production as it has in the current past. Therefore, financiers pushed the electric vehicle (EV) stock down 6.6% since 10:59 a.m. ET.

CNBC reported the other day that the number of cities in China that have implemented COVID-related limitations has actually doubled. Among the locations is a province called Anhui, where Nio has a manufacturing facility.

Nio reported its second-quarter lorry distributions late last week, with quarterly vehicle deliveries up 14% year over year as well as June deliveries increasing 60%. Part of that development was aided partially due to the fact that pandemic constraints were eased during that duration.

China has a very strict “zero-COVID” plan that restricts motion by residents and has actually led to manufacturing facilities for Nio, as well as other EV makers, stopping car production.

Nio capitalists have actually been on a wild flight recently as they process inflation information, rising fears of a worldwide recession, and climbing coronavirus instances in China. As well as with the most current news that some parts of China are experiencing brand-new lockdowns, it’s most likely that the volatility Nio’s stock has experienced lately isn’t finished just yet.

Nio shareholders should maintain a close eye on any kind of new developments concerning any kind of temporary factory shutdowns or if there’s any type of indication from the Chinese government that it’s downsizing on restrictions.

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