Nio share price traded upward in the pre-market session on Wednesday as investors weighed the EV maker’s sales outlook against China’s non-commital stimulus plan announced over the weekend. Nio stock price declined by 2.9 percent on Tuesday, but was up by 1.7 percent in the session before the bell on Wednesday, signalling a potential upturn.
China’s government gave no clear indication of how it would support its highly subsidised EV industry of which Nio is a key beneficiary. This has injected skepticism over the company’s growth outlook in its primary market. However, Nio delivery figures in September give investors much to think about.
The company sold 21,181 units, the second-highest on record. That number could rise significantly in October as it marks the first full month of its cheapest model, the Onvo L60 SUV. Notably, the EV maker has regorded a 35.7 percent jump in sales year-over-year since January, despite the economic downturn in China.
The company is also well armoured as far as its cash position goes, after it received $1.9 billion infusion from its Shanghai-based strategic investors. Nio (NYSE: NIO) has also embarked on expansion of its market outside China, and plans to starts sales in the Middle East and North Africa region later this year. That could cushion it from shocks in China and provide tailwinds to Nio share price.
Nio share price wil likely head upward if the bulls keep the action above the 5.67 pivot level. If that happens, the upside could proceed to encounter the first resistance at 5.76. However, a sttronger upward momentum could break above that level to test 5.84.
Conversely, moving below 5.67 will signal a bearish takeover. In that case, initial support will likely come at 5.57. However, if the sellers extend their control, NIO could breach that level, invalidate the upside narrative and potentially test 5.50.
This post was last modified on Oct 16, 2024, 10:39 BST 10:39