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

Shares of Chinese electric vehicle makerĀ nio stock (NIO 0.44%) were toppling today on relatively no company-specific news. Instead, investors might be responding to information from yesterday that some parts of China were experiencing a surge in COVID-19 situations.

A lot more lockdowns in the nation can once again slow the business‘s car production as it has in the current past. Therefore, capitalists pressed the electrical vehicle (EV) stock down 6.6% since 10:59 a.m. ET.

CNBC reported yesterday that the number of cities in China that have actually implemented COVID-related constraints has increased. One of the areas is a district called Anhui, where Nio has a manufacturing facility.

Nio reported its second-quarter car shipments late recently, with quarterly automobile distributions up 14% year over year and also June shipment enhancing 60%. Part of that development was helped partially because pandemic constraints were relieved during that period.

China has a very rigorous “zero-COVID” plan that restricts activity by residents and has actually led to factories for Nio, and other EV manufacturers, halting vehicle manufacturing.

Nio investors have actually gotten on a wild ride recently as they refine inflation information, rising anxieties of an international recession, and rising coronavirus situations in China. And with the most recent news that some parts of China are experiencing new lockdowns, it’s most likely that the volatility Nio’s stock has experienced recently isn’t ended up just yet.

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

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