Why Shares of Chinese electrical automobile manufacturer Nio (NIO 0.44%) were tumbling this morning?

Shares of Chinese electrical cars and truck makerĀ nio stock quote (NIO 0.44%) were tumbling this morning on seemingly no company-specific information. Instead, investors may be reacting to news from yesterday that some parts of China were experiencing a rise in COVID-19 cases.

A lot more lockdowns in the nation can once more slow the business‘s car manufacturing as it has in the recent past. Because of this, financiers pressed the electrical car (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 implemented COVID-related restrictions has actually doubled. Among the locations is a district called Anhui, where Nio has a factory.

Nio reported its second-quarter car distributions late recently, with quarterly car shipments up 14% year over year as well as June shipment enhancing 60%. Part of that development was aided partially because pandemic constraints were alleviated throughout that duration.

China has a really stringent “zero-COVID” policy that restricts activity by citizens as well as has caused factories for Nio, and various other EV manufacturers, halting automobile manufacturing.

Nio financiers have gotten on a wild trip lately as they refine rising cost of living data, rising fears of a worldwide economic downturn, and climbing coronavirus situations in China. As well as with one of the most current information that some parts of China are experiencing brand-new lockdowns, it’s likely that the volatility Nio’s stock has actually experienced recently isn’t completed just yet.

Nio investors must keep a close eye on any kind of new developments about any temporary factory shutdowns or if there’s any type of sign from the Chinese government that it’s downsizing on constraints.

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