Nio stock bounces, even after Tesla CEO Elon Musk says China seeing ‘burst of recession’

Nio stock bounces, even after Tesla CEO Elon Musk says China seeing ‘burst of recession’

The U.S.-listed shares of China-based Nio Inc. NIO, +0.46% gained 0.1% in afternoon trading Thursday, after closing the previous session at the lowest price since July 2020, despite the 6.7% selloff in rival electric vehicle maker Tesla Inc.’s stock TSLA, -6.65% after disappointing third-quarter results.

Meanwhile, shares of fellow China-based EV makers XPeng Inc. XPEV, +3.52% climbed 3.9% after closing Wednesday at a record low, and Li Auto Inc. LI, +2.98% hiked up 3.0% after closing Wednesday at a two-year low. The rallies come after Tesla Chief Executive Elon Musk was asked on the post-earnings conference call with analysts about the EV maker’s performance in China, and Musk answered “China is experiencing quite a burst of a recession of sorts,” according to a FactSet transcript. He said Europe was in a “recession of sorts” while North America’s economy remained “pretty healthy.” Tesla hasn’t filed its third-quarter 10-Q yet, but the second quarter 10-Q showed that revenue generated from China represented 22.4% of total revenue. Nio’s stock has tumbled 46.3% over the past three months, while Tesla shares have lost 16.3%, the iShares China Large-Cap ETF FXI, +0.46% has dropped 25.1% and the S&P 500 SPX, -0.80% has declined 7.2%.

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