3 Reasons Why Nio Shares Are Surging Thursday

Nio Inc – ADR NIO shares briefly broke above the psychological resistance level of $30 Thursday morning.

Although the stock has backed off that level, it is still trading with notable gains.

What Happened: The Chinese electric vehicle manufacturer's stock has been one of the best performers in the year-to-date period, having gained about 600%.

Thursday's rally has come amid a trio of catalysts.

Nio Partakes In Broader Market Recovery: The broader market was sharply lower for three sessions on the trot this week, dragged by waning stimulus hopes, uncertainty around the U.S. presidential election and simmering fears over the COVID-19 pandemic.

From Monday through Wednesday, the Dow Jones Industrial Average shed about 6.4% and the S&P 500 Index lost 5.6%.

Nio weathered this broader market weakness fairly well and was up 1.2% in the said period. On Wednesday, Nio was down about 3.3%.

With the broader market recovering on bargain hunting, facilitated by better-than-expected third-quarter GDP data and a tech rally ahead of earnings from some high-profile tech names, Nio has found some momentum.

Related Link: Why Nio Has A Shot At Becoming The 'Tesla Of China'

Nio Wins Government Contract For Vehicle Supply: Recently, Nio won a Chinese government contract to supply vehicles to Beijing municipal administrative institutions between 2020 and 2022.

Nio is one of the 16 companies chosen to supply new energy vehicles that meet the emission standards of the Beijing administrative region.

Nio Hits 5K Monthly Production: Nio's production line cranked out 5,000 vehicles for the month at the Hefei Advanced Manufacturing Base Oct. 29, the Cntech Post reported, quoting the company. This is the first time Nio has accomplished monthly production of 5,000 units.

NIO Price Action: At last check, Nio shares were rallying 10.3% to $30.36. 

Related Link: Nio Shares Rise After EV Maker Announces Autopilot Feature, Faster Charging Options

Courtesy photo.