- NYSE:NIO adds another 2% to Monday’s rally in early trading.
- Chinese stocks continue to see inflows after recent heavy selling.
- NIO targets $40 and a break above short term moving averages.
Update: NIO stocks rose to fresh four-day highs of $39.61 on Tuesday, before reversing some gains to finish at $38.94, still adding 2.02% on the day. Over the last three straight trading days, NIO share price gained nearly 7%. Buying resurgence in the US-listed Chinese stocks lifted the sentiment around the Chinese electric vehicle maker NIO. Meanwhile, fresh record highs on the broader Indices also collaborated with its recent recovery momentum.
NYSE:NIO rebounded to start the week as investors shrugged off the recent driver-assist system fatality that caused the stock to tumble last week. Other good news had China stocks rallying, including the first day since July in which no new cases of COVID-19 were reported in the country. Shares of NIO gained 3.39% to close the trading session at $38.17. The markets rebounded to start the week as the NASDAQ and S&P 500 hit new all-time highs on the strength of tech sectors, particularly chip makers like AMD (NASDAQ:AMD) and NVIDIA (NASDAQ:NVDA).
Speaking of chip makers, it is believed that worsening COVID-19 cases in South East Asian countries like Malaysia, could cause the ongoing chip shortage to worsen over the near term. This shortage has already affected companies like Nio, which cited the shortage in chips for falling production numbers in the second half of this year. Other companies like Ford (NYSE:F) have also had to delay releases of new electric vehicle models, and unfortunately it looks like this shortage is going to continue into 2022.
In Stateside news, General Motors (NYSE:GM) fell on Monday and lagged the broader electric vehicle sector. The sell off was due to the company recalling its Chevrolet Bolt vehicles over concerns that the battery may catch fire. This recall includes all models of the Bolt including the newer ones from 2021 and is expected to cost General Motors upwards of $1 billion USD. The recall is a black eye for all electric vehicles, but investors only seemed to want to punish shares of GM on Monday.
Update: NIO continued to recover on Tuesday after a turbulent week last week. NIO stock added over 3% on Monday and so far in early trading on Tuesday the electric car maker is up just about 2% in early trading. $40.61 is the resistance to aim for as this is the gap from last week’s drop on the chart. NIO needs to break $47 though to turn bullish on the charts.
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