Why Nikola Shares Are Rising

Nikola Corp NKLA shares are trading higher by 6.38% to $5.35 Wednesday morning after BTIG upgraded the stock from Neutral to Buy. The stock also appears to be rebounding following Tuesday's market selloff.

Shares of several companies in the auto & auto component sector, including Nikola, were trading lower Tuesday amid overall market weakness as August CPI readings showed inflation came in greater than expected.

This has caused economic concerns and raised expectations for more aggressive Fed policy, which could negatively impact discretionary spending.

What Happened?

According to data from the U.S. Bureau of Labor Statistics, the headline CPI rose 8.3% in August, down from 8.5% in July. The August CPI reading came in above average economist estimates of 8%. 

Core inflation, which excludes volatile food and energy prices, was up 6.3% in August, above average economist estimates for a 6.1% gain...Read More

Inflation can negatively impact discretionary spending, as it can result in the reduction of purchasing power of some consumers.

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According to data from Benzinga Pro, Nikola has a 52-week high of $15.56 and a 52-week low of $4.42.