Nio Stock (NYSE:NIO)
Nio stock (NYSE:NIO) has dropped by more than 40% in the last month, far exceeding the roughly 14% decrease from the S&P 500 index over the same period. Nio stock has lost another 2.5% today as of 11:25 a.m. Eastern Time and is continuing its downward trend. Nio stock price dropped by 7% when it reached its daily low.
Then what?
A double dose of negative macroeconomic news is primarily responsible for today’s decline in price. The latest report on inflation in the United States was, once again, far worse than anticipated. After two months of sluggish monthly growth, the Consumer Price Index increased at a faster clip in September, increasing by 0.4% month over month compared to the previous month. Although Nio (NYSE:NIO) does not currently do business in the United States, the potential for the Federal Reserve to be forced to hike interest rates much farther than intended does have worldwide repercussions. The International Energy Agency (IEA) delivered the second dosage of bad news when it said in its monthly market report for October that the newly agreed oil production cutbacks from OPEC+ might lead to a worldwide recession. This was the second dose of bad news that was delivered.
What’s Next?
To be more specific, the International Energy Agency (IEA) made the following statement: “With persistent inflationary pressures and interest rate rises taking their toll, increased oil prices may prove the tipping point for a global economy already on the edge of recession.”
Nio stock has recently released several new models and is increasing its European supply capacity. It is quite possible that a worldwide recession would have a severe effect on its aspirations for expansion. As a result of the increased amount spent on operational costs during the second quarter, the corporation recorded an increase in its net loss to $412 million. Investors know that the company’s route to profitability will be hampered if a reduction in consumer demand occurs due to a slowing economy or recession in its markets. Because of this, investors have less of a desire to invest in risky assets like Nio stock.
Featured Image- Megapixl @ Michaelvi
Author Shariq Khan 
