Why Nio's Stock Is Stalling Today

After rising on Tuesday, shares of Nio (NYSE: NIO) shifted into reverse yesterday, and investors currently don't seem interested in changing direction. Officials in Shanghai remain unchanged in their dedication to severe lockdown measures, attempting to stem the spread of COVID-19. Investors, consequently, are concerned that this could affect the company's ability to sustain operations at a nearby factory. In addition, the strong earnings report that Tesla released last night may have Nio investors instead looking to shift gears and park shares of Elon Musk's company in their portfolios.

As of 1:12 p.m. ET, shares of Nio are down 4.8%.

According to Reuters, local politicians intend to keep strict measures in place in Shanghai -- regardless of whether quarantined areas have no positive cases -- to prevent rising cases of COVID-19. Among the regulations in place, residents of areas in lockdown are not allowed to visit supermarkets, and only one member per household is allowed to visit town daily. For Nio investors, the question of whether restrictions will lead to the company having to suspend operations at a factory located outside the city is surely weighing heavily on their minds.

Source Fool.com