What happened
After racing higher yesterday, shares of Nio (NIO -3.47%) are taking a U-turn today and heading in the other direction. Evidently, geopolitical tension and the fear of rising COVID-19 cases in China is weighing heavily on investors' minds, motivating them to shift the electric vehicle (EV) manufacturer out of their portfolios.
As of 11:26 a.m. ET, Nio's stock is down 6.8%.
So what
The conflict between Ukraine and Russia continues to remain at the forefront of investors' attention, and they're undoubtedly paying close attention to any developments -- such as China's recently discussed position on the conflict. According to the Global Times, a publication of the Chinese Communist Party, Fan Xianrong, the Chinese ambassador to Ukraine, stated that "China will never attack Ukraine, we will help, in particular in the economic direction. We have seen how great the unity of the Ukrainian people is, and that means its strength."
Image source: Getty Images.
Another issue giving investors pause today is the rising number of COVID-19 cases in China. Attempting to stem the outbreak, Chinese officials implemented a lockdown in Shenzhen, a hub of technology and manufacturing. While Nio hasn't reported the shuttering of any factories, Tesla (TSLA -0.05%) is imposing its own slowdown in production. Yesterday, Elon Musk's EV venture announced a two-day shutdown of operations at its facility in Shanghai in response to the rising humber of COVID-19 cases.
Now what
The Chinese ambassador's commentary about the nation's support of Ukraine, in and of itself, doesn't suggest anything troubling for Nio; however, it's likely that investors are fearful of the nation asserting itself with regard to the conflict, and if there's one thing investors detest, it's fear. Similarly, the growing number of cases may be making EV investors worry that additional lockdowns may be coming, but it's hardly a reason for investors with long-term investing horizons to click the sell button.
