Why Shares of Chinese electric car manufacturer Nio (NIO 0.44%) were tumbling today?

Shares of Chinese electrical automobile makerĀ nio stock forum (NIO 0.44%) were rolling this morning on seemingly no company-specific information. Instead, financiers may be reacting to information from yesterday that some parts of China were experiencing a surge in COVID-19 cases.

Much more lockdowns in the nation might once again slow the firm’s car production as it has in the recent past. Consequently, capitalists pressed the electric lorry (EV) stock down 6.6% as of 10:59 a.m. ET.

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

Nio reported its second-quarter vehicle distributions late last week, with quarterly automobile distributions up 14% year over year as well as June shipment increasing 60%. Part of that development was aided partly due to the fact that pandemic constraints were reduced throughout that duration.

China has a really strict “zero-COVID” policy that restricts movement by residents and has resulted in factories for Nio, and also other EV manufacturers, halting automobile production.

Nio investors have gotten on a wild ride recently as they process rising cost of living information, climbing anxieties of a worldwide economic downturn, and also climbing coronavirus situations in China. And with one of the most current news that some parts of China are experiencing brand-new lockdowns, it’s likely that the volatility Nio’s stock has experienced lately isn’t completed right now.

Nio investors need to maintain a close eye on any new advancements about any short-term factory shutdowns or if there’s any type of indicator from the Chinese federal government that it’s downsizing on limitations.

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