Why Shares of Chinese electrical cars and truck manufacturer Nio (NIO 0.44%) were tumbling today?

Shares of Chinese electrical cars and truck makerĀ nio stock forecast (NIO 0.44%) were toppling this morning on seemingly no company-specific news. Rather, investors might be reacting to information from the other day that some parts of China were experiencing a surge in COVID-19 cases.

More lockdowns in the nation might once more slow down the business‘s lorry production as it has in the current past. Because of this, investors pressed the electric vehicle (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 carried out COVID-related restrictions has doubled. One of the areas is a district called Anhui, where Nio has a manufacturing facility.

Nio reported its second-quarter automobile distributions late recently, with quarterly automobile distributions up 14% year over year and June distribution boosting 60%. Part of that development was helped partially since pandemic constraints were alleviated during that duration.

China has a really stringent “zero-COVID” policy that restricts activity by people and also has actually led to manufacturing facilities for Nio, as well as various other EV makers, halting automobile manufacturing.

Nio investors have actually been on a wild flight lately as they process rising cost of living information, rising worries of a worldwide recession, and climbing coronavirus cases in China. As well as with the most recent 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 investors should keep a close eye on any type of new advancements about any kind of temporary manufacturing facility closures or if there’s any kind of indicator from the Chinese federal government that it’s scaling back on restrictions.

Should you invest $1,000 in Nio Inc. right now?
Prior to you take into consideration Nio Inc., you’ll intend to hear this.