Shares of Nio Inc. NIO, +2.64% bounced 1.5% in premarket trading Tuesday, after suffering in the previous session the worst selloff since March 2020 in the wake of China President Xi Jinping’s moves to consolidate power. The China-based electric vehicle maker’s stock had tumbled 15.7% on Monday, to the first close below the $10 mark since July 2020. Analyst Vijay Rakesh reiterated his buy rating on Nio and his $40 stock price target, which implies 323% upside from Monday’s closing price. Rakesh believes overall global battery EV demand “remains strong,” but geopolitical risks with further restrictions in China, as the country enforces its zero-COVID policy, overshadowed fundamental outlooks for China-based automakers. Nio’s bounce comes even as futures ES00, +0.16% for the S&P 500 SPX, +0.19% fell 0.4% ahead of the open. Meanwhile, XPeng Inc.’s stock XPEV, +3.42% rose 1.8% in premarket trading after tumbling 11.9% to a record low on Monday, and Li Auto Inc. shares LI, +4.09% rose 2.7% premarket after falling 17.4% Monday to a two-year low. Tesla Inc.’s stock TSLA, +1.15% lost 1.1% premarket after shedding 1.5% on Monday; Tesla generated 23.9% of third-quarter revenue from China.
