Shares of Nio Inc. (NIO) experienced a positive turn in premarket trading on Friday, with a 2.7% climb. This comes after a 3.1% bounce in the previous sessions, thanks to a combination of factors that have provided support for the China-based electric vehicle maker.
The recent strike impacting some U.S. autoworkers, along with an interest rate cut in China, has contributed to Nio’s rally. On Wednesday, the stock had slumped by 4.7% due to an investigation launched by the European Union into China’s subsidies for its EV makers. This move by the EU was condemned by China, labeling it as “naked protectionism” and potentially damaging trade relations between both parties.
Furthermore, China’s central bank made a decision to cut a short-term policy rate on Friday in an effort to stimulate economic growth. This development also reportedly played a role in boosting Nio’s stock.
Interestingly, the ongoing labor strike affecting General Motors Co. (GM), Ford Motor Co. (F), and Chrysler parent Stellantis N.V. (STLA) is seen as potentially benefiting competitors who operate with non-union labor forces, including fellow EV maker Tesla Inc. (TSLA). As a result, Tesla’s stock increased by 0.5% ahead of the market opening.
In addition to Nio, other China-based EV makers also experienced gains. XPeng Inc.’s stock (XPEV) rose by 1.5%, while Li Auto Inc. (LI) saw a 0.3% increase in shares.
Overall, with the support gained from strikes impacting its competitors and the interest rate cut in China, Nio Inc. continues to show promising growth in the electric vehicle industry.
