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Nio Drops as China Announces More Covid Lockdowns

Published 10/11/2022, 12:00 PM
Updated 10/11/2022, 12:07 PM
©  Reuters Nio (NIO) Drops as China Announces More Covid Lockdowns
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By Michael Elkins

Shares of Nio Inc (NYSE:NIO) are down 0.38% in mid-day trading on Tuesday following a rough start to the week as the company dropped 3.5% on Monday on news that China has announced more covid lockdowns.

Following a week of national holidays, cases of Covid-19 in China are once again on the rise, and several cities imposed new lockdowns. Shanghai, a city of 25 million people, reported 28 local cases for Oct. 10, the fourth day of double-digit increases.

As of Monday, 36 Chinese cities were under various degrees of lockdown or control, affecting around 196.9 million people, versus 179.7 million in the previous week.

Despite China's very small caseload versus the rest of the world, and the toll its counter-epidemic policies exact on the economy and population, the government has repeatedly urged people to accept the measures.

"Once a large-scale rebound occurs, the epidemic will spread, and is bound to have a serious impact on economic and social development, and the final price will be higher and losses will be greater," state-controlled People's Daily wrote in a commentary on Tuesday

Nio stock is down 61% year to date and 38% in just the past month. New covid lockdowns in Shanghai and other commercial and industrial centers in China may have a slowing effect on both production and sales.

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