What happened
Shares of XPeng (XPEV -1.39%), a Chinese electric-vehicle (EV) maker, were soaring today, as some investors grew optimistic that COVID-related protests in China could encourage the government to ease away from its strict policies. As a result, the EV stock was up by 8.1% as of 11:19 a.m. ET.
So what
China has implemented restrictions and lockdowns on its citizens since the pandemic began, but citizens in the country are beginning to push back on the policies. The lockdowns have resulted in significant disruptions to companies and businesses, including EV production. Investors are hoping that the protests could lead to an easing of the policies and make it easier for XPeng and other Chinese companies to conduct business.
The disruptions in the country had led many investors to ditch Chinese stocks over the past year and have been part of the reason why XPeng's share price is down 85% year to date.
Now what
While XPeng investors are optimistic today, the Chinese government hasn't given any indication that it's backing away from its zero-COVID policies. While investors may be hoping for things to change in the country soon, today's gains could easily get wiped out once investors realize the Chinese government isn't budging on its coronavirus restrictions and lockdowns.
Investors will get a clearer picture of how XPeng is doing right now when the company reports its third-quarter results before the opening bell tomorrow morning.
