NIO seems to be undergoing a pretty rough patch of luck, as it keeps fluctuating without any conceivable reason. Although it did start at a pretty good rate, it suddenly felt its stocks dropping overnight. As we can see now, the shares are falling again. The main question arises- why are the stocks of this popular electric vehicle falling? By now, investors should have a very good idea as to the broader narrative of things. NIO has been quite the performer throughout this year- simply because electric cars are all the rage these days. Also, the electric car market in China seems to be moving at a pretty good rate.
But, there have been a couple of factors that have led to the downfall of the stocks of NIO.
NIO Has Faced The Regulation Threat
The previous week saw most of the electric car companies in China falling considerably. And while there were quite a lot of rumors as to this course of action, it was later found out that the government seemed to be very excited about putting up regulations. Goes without saying, this actually seems like a sensible move by the government, due to the increase in the market. There are several electric vehicle makers in the country, and most of them have been churning out car after car this year.
Delisting Threat Weighs on NIO stock
The House of Representatives on Wednesday did pass a bill that would enable the US Stock exchange to make certain discretionary actions. These actions would usually involve the stock exchange to remove any foreign company that wouldn’t submit to proper audit processes. As it goes, it could signal the end of NIO at the NYSE.
Peer Weakness
With the other companies failing around NIO, it should come as no surprise that the less than extraordinary reviews would be hurting the stocks of NIO as well.
But, lest it is forgotten, check up on reliable sources, and don’t blindly follow rumors about NIO and its peers.
