The U.S.-listed shares of China-based electric-vehicle manufacturer Nio Inc. witnessed a surge in value on Monday following reports that China’s state planning body is encouraging cities to ease car-buying restrictions and promote the adoption of electric vehicles (EVs).
Nio’s stock (NIO) climbed 3.6% during morning trading, positioning itself for the highest close since October 5, 2022. Notably, this increase marks a substantial 48% growth over a seven-day winning streak.
This ongoing winning streak is particularly impressive as it rivals the previous record set during a seven-session stretch that concluded on April 26, 2021. Moreover, since Nio went public in September 2018, the current streak is the second-longest winning streak, right after the nine-day run that ended on January 21, 2020.
The remarkable performance of Nio’s stock during the past seven days sees a 48% gain, which stands as the best seven-day growth for the company since it soared by 51.3% over a seven-session period ending on November 6, 2020.
Over the last three months, Nio shares have skyrocketed by an impressive 94%. In comparison, the iShares MSCI China exchange-traded fund has experienced a modest 4% increase, and the S&P 500 has gained a solid 10%.
China Urges Easing of Car-Purchase Restrictions to Boost EV Sales
China’s National Development and Reform Commission has called on local governments to relax car-purchase restrictions and implement measures to stimulate new-car purchases. In addition, the commission has instructed local officials to promote the use of electric vehicles (EVs) in rural areas and upgrade EV-charging infrastructure.
This announcement comes shortly after China’s Politburo expressed optimism about the country’s economy and pledged further support, while also acknowledging challenges to growth.
While Nio’s stock experienced a rally, some rival China-based EV manufacturers saw a decline in their share prices.
XPeng Inc.’s stock plummeted by 13.6% during morning trading. The stock had previously soared by 52.2% over the course of three sessions following the news of a $700 million investment by Volkswagen AG, as part of a collaboration to jointly develop VW-branded EVs for the Chinese market.
Li Auto Inc.’s stock also fell by 0.6%, after experiencing a 9.6% increase on Friday, which led to its highest closing price since November 24, 2020, at $43.96.
Tesla’s Revenue in China
Tesla Inc. reported that it generated 23% of its total second-quarter revenue in China. Despite this, the company’s shares, indicated by TSLA -0.15%, only saw a slight increase of 0.2%.
