What happened
Shares of Chinese electric vehicle (EV) maker Nio (NIO -5.00%) have bounced off multiyear lows this week in a big way. The stock is on track to rise by double digits. As of Friday afternoon, shares were about 16% higher for the week, according to data provided by S&P Global Market Intelligence.
So what
The rise in Nio shares was a bounce off the bottom for both micro and macro reasons, and likely also from some hopeful optimism heading into this weekend. Nio is about to announce its first-quarter delivery data, and investors hope it surpasses its prior, seemingly conservative guidance.
There are also macro issues that helped push Chinese stocks higher this week. Nio likely is riding those tailwinds as well.
Image source: Nio.
Now what
Nio has previously set expectations for first-quarter deliveries of between 31,000 and 33,000 vehicles. That's a sharp drop from the more than 40,000 vehicles it shipped in the prior quarterly period. Some investors seem to be betting that the upcoming delivery report, and second-quarter projections, will provide more optimism.
This week's move also comes as two widely followed Chinese technology companies have announced major restructurings. Alibaba and e-commerce company JD.com have both said they are splitting out portions of their businesses to unlock value. Both stocks shot higher on the news this week.
That's relevant for Nio and its investors because it signals that Chinese regulators are approving of activity in the capital markets. That could be good for the overall Chinese economy, which would likely result in more robust consumer spending.
That would also be good news for Nio. If this weekend's update shows the business is already doing well with better-than-expected delivery data, investors buying this week may be getting in ahead of another leg higher for Nio stock.
