Nio stock was soaring after the Chinese electric-vehicle maker announced a new car. The big move, however, may have more to do with hopes for the Chinese economy than any individual car.
Nio stock has gained 16.7% to $18.66 on Tuesday ahead of a launch event on Wednesday. The company is expected to reveal its much-anticipated ES7 SUV -- it teased a video of something -- and the hope is that it will help drive new sales through 2022.
But Nio is also benefiting from what looks to be a reassessment of Chinese stocks by investors. While the S&P 500 has fallen 0.3% and the Dow Jones Industrial Average is off 0.5%, the iShares MSCI China ETF has gained 3.1%. That's helped boost not only Nio, but Li Auto, which is up 10.9%, XPeng, which has risen 7.52%, and Alibaba Group Holdings, which is up 6.8%.
What's brought Chinese stocks, which have gotten pummeled, back into favor, at least for one day. After another series of near-total Covid-19 lockdowns, the economy has started to reopen, while policy makers are starting to take steps to ease monetary conditions at a time when the U.S. Federal Reserve is set to raise interest rates by the most since the 1990s.
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