11% rally on Tuesday stemmed from positive signs for US, China economies – Crypto News – Crypto News
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11% rally on Tuesday stemmed from positive signs for US, China economies – Crypto News

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  • Nio gained 11.2% to close at $9.34 per share on Tuesday.
  • NIO stock traded lower in six consecutive sessions before Tuesday’s pop.
  • Hong Kong and Chinese stock markets were both largely flat on Wednesday.
  • Politician announces that Chinese economy will reach 5% growth rate in 2023.

Nio (NIO), the Chinese electric vehicle (EV) competitor, witnessed its share price add on 11.2% on Tuesday in a session that saw Wall Street clamber back into the market. The S&P 500 added 1.15% in the session, while the NASDAQ 100 surged 1.75%.

Nio stock news: turnaround arrives after six-session sell-off

It was high time for a Nio reversal as the EV firm sold off in all six sessions from June 16 to June 26. Tuesday witnessed a surge in nearly all EV stocks.

major rivals Tesla (TSLA) gained 3.8% one day after Goldman Sachs handed it a downgrade, and Chinese rival XPeng (XPEV) closed 8.1% higher. The maker of the long-range Air sedan, Lucid (LCID)jumped 9.9%.

Chinese equities Like Nio advanced largely on Premier Li Qiang’s message at the World Economic Forum that the Chinese economy’s growth rate of 4.5% in Q1 would likely reach 5% for the full year. This positive forecasts for Chinese GDP then met other positive data coming from the US market.

On Tuesday, the Conference Board reported Consumer Confidence data demonstrating that the percentage of people expecting a recession over the next 12 months is falling. Additionally, the Durable Goods report for May showed a 1.7% expansion rather than the forecasted decline. The Richmond Fed’s Manufacturing Survey also improved from the previous month, and New Home Sales Arrived well ahead of the forecast.

The combination of positive US and Chinese news was enough to send the US market higher after a week or more of the equity downtrend. In fact, the NASDAQ Composite marked its best gain in over a month. On Wednesday, however, China and Hong Kong stock markets remained largely unchanged.

On June 21, the Chinese government unveiled $72 billion worth of tax cuts to subsidize its homegrown EV industry. Thus far, the policy has not led to a rally in Chinese EV stocks since the tax cuts do not begin until 2024.

NIO FAQs

What is Neo?

Nio is a designer and manufacturer of electric vehicles based in Shanghai, China. Formerly known as NextEV, the company changed its name to Nio in 2017. Nio trades under the NIO symbol on the New York Stock Exchange (NYSE) and under the 9866 tag on the Hong Kong Stock Exchange. The company was incorporated in 2014 but went public on the NYSE in September 2020 with a $1.8 billion initial public offering. William (Bin) Li is the CEO of Nio, which he co-founded with President Lihong Qin, another Chinese business executive.

How is Nio different from other EV manufacturers?

The main difference with other major EV brands like Tesla is that Nio offers battery swapping technology in addition to normal charging options. These swap stations allow drivers to switch out their batteries for fully-charged, identical batteries in less than five minutes, which allows owners to drive long distances without needing to stop for an hour to recharge like most other EVs. At the end of 2022, Nio had 1,305 battery swap locations and built its first swap station in Norway in May 2022. The goal for the customer is to reduce range anxiety.

What vehicles does Nio offer?

Nio began its reign with the EP9 sports car back in 2016, and the vehicle is still being produced on a small scale. Since then, Nio has branched off into more mainstream fare. The ES8 was introduced in 2018. It is a full-size SUV with a range of 311 miles. The ES6 SUV dropped the following year and has a range of 379 miles. The smaller EC6 SUV arrived in 2020, and the ET5 and ET7 sedans were released in 2021 – the latter two with versions capable of achieving 621 miles of range. The ES7 and EC7 arrived in 2022 and 2023, respectively.

Are Nio vehicles sold outside China?

Yes. While the vast majority of Chinese automakers focus wholly on the Chinese market, Nio began its foray into Europe in late 2021. After beginning in Norway, Nio began entering the German, Danish, Dutch and Swedish markets in 2022 with plans to expand throughout the rest of the decade. Although they are not yet sold in the US, Nio vehicles are being tested in California under that state’s autonomous driving program.

nio stock forecast

Nio stock broke out of its five-month downtrend on June 12. That same week it met its zenith on June 16 at $10.21 before entering the six-day downtrend. Bulls now need to break above that $10.21 level to ensure the rally continues. This would require a little more than a 9% gain, so it remains a distinct possibility.

The $9.50 level, however, has been a thorn in the side of bulls for most of this year. If Nio stock powers through it and the $10.21 level, then bulls will make a run at the $13 to $14 resistance zone.

nio daily chart

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