NIO Stock Forecast: Nio Inc drops another 3% amid concerns over rising competition

• NYSE: NIO corrects further on renewed concerns over rising competition. 
• Nio strikes a deal to make all of its battery swap stations solar powered.
• Two of Nio’s rivals in China may be teaming up with a new battery supply agreement. 

Update October 28: NYSE: NIO extended the correction from two-month highs of $42.61 into the second straight day on Wednesday, tracking the broad weakness in the Wall Street indices. NIO stock price lost another 2.87% on the day, finishing near daily lows of $39.26. The NIO shares shaved off early gains and tumbled, as investors assessed the impact of rising competition on the Chinese automaker's prospects. This comes after Tesla secured an order for 100,000 electric vehicles from rental company Hertz earlier this week. Looking ahead, the US earnings and Q3 GDP data will drive the sentiment on Wall Street, in turn, impacting the NIO stock price.

NYSE:NIO finally cooled off on Friday after climbing higher for most of the week. Shares of NIO fell by 2.73% to close the trading week at $38.88. Growth stocks pulled back on Friday as the NASDAQ saw its worst session of the week, tumbling by 0.82% and erasing some of the gains it had made during previous trading days. The Dow Jones continued its strong run and closed at a fresh new all-time high after adding a further 73 basis points. The S&P 500 inched lower, as disappointing earnings reports from companies like Intel (NASDAQ:INTC) and Snap (NYSE:SNAP) soured investor sentiment. 

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Nio signed a new agreement with Unisun Solar in China to place photovoltaic or PV panels on the roofs of all of its battery swap stations. The company anticipates having more than 4,000 battery swap stations in service by the end of 2025, and is planning to source much of the energy to power these stations, as well as potentially recharging the batteries, from the sun. By 2025, Nio believes that the total amount of energy created from the battery swap stations will equal approximately 300 MW of power. 

NIO stock price

Two of Nio’s rivals in the domestic market of China are reportedly teaming up as Warren Buffet-backed BYD will potentially be providing batteries to Tesla (NASDAQ:TSLA). Tesla is switching over to LFP batteries, and may be interested in using BYD’s Blade Battery over CATL’s 126 batteries. The deal has not been confirmed yet as of the time of this writing.

Previous updates

Update: NYSE:NIO settled at $39.31, down 2.87% on Wednesday. Stocks took a turn to the worst after the Bank of Canada announced it has decided to end its weekly purchases of government bonds, the first central bank to end pandemic-related facilities, surprising investors who were speculating on a gradual reduction of QE. The US Federal Reserve, the Bank of England and even the European Central Bank, are also in the tapering path, with movements there expected for the next quarter. The Bank of Japan and the ECB will announce their decisions this Thursday, while the Fed will meet next week. The Nasdaq Composite held ground, ending the day unchanged, while all other major indexs closed in the red, with the NYSE shedding 203 points or 1.19%.

Update: NYSE: NIO extended Monday’s rally to hit fresh two-month highs at $42.61 on Tuesday. However, NIO shares failed to sustain at higher levels and corrected sharply to finish the day 1.94% lower at $40.47. The move higher came on the back of a bullish momentum seen across the Electric Vehicle (EV) sector. Additionally, strong earnings on the US stocks and upbeat American economic data lifted the market mood, collaborating with NIO’s upside. However, the gains were quickly shaved off on reports that the US banned China’s telecom over national security concerns.

Update: NYSE:NIO lost 1.96% on Tuesday to close at $40.47 per share. US equities seesawed between gains and losses, to finally close with modest gains. The DJIA and the S&P 500 settled at record levels following another batch of outstanding earnings reports. Even further, CB Consumer Confidence unexpectedly bounced in October, printing at 113.8 from an upwardly revised 109.8. The NYSE Composite added 13 points, to close the day at 17,182.

Update: NYSE: NIO staged an impressive comeback on Monday, rallying 6.15% on the day to finish near the highest levels in seven weeks at $41.42. In doing so, NIO stock price finally made a sustained move above the $40 level. NIO shares tracked the bullish momentum across the Electric Vehicle (EV) sector, especially in light of several encouraging news from its competitors in Tesla and Xpeng. The record close on Wall Street indices amid strong US corporate earnings aided the rebound in NIO.

Update: NYSE:NIO finally recaptured the $40.00 mark, ending Monday 6.15% higher at $41.27. Despite modest gains, US indexes managed to extend their recent rallies to fresh record highs, with the DJIA and the S&P 500 in unexplored territory. The NYSE Composite added 42 points or 0.25%, to settle at 16,164.95. 

Update: NIO has opened the week in the green, rallying 2.4% at the time of updating back above the psychological $40 mark. The electric vehicle stock is just 30 cents below the six-week highs established last Tuesday at $40.89, and a break above there could target the $41.83 resistance, the September high and only close resistance level.