Shares of Chinese EV player Nio (NYSE:NIO) are certainly charging up today. Indeed, investors in NIO stock are seeing gains of 6% at the time of writing on a rather volatile day.
This week happens to be a quadruple witching week. What this means is that this Friday, a series of stock options, single stock futures, index options and index futures all expire. Given the penchant large funds have to rebalance their portfolios around the expiration dates of these options and futures, more volatility tends to take hold during these time frames.
For Nio, a stock which has proven to be a volatile one on its own, this volatility is noticeable. However, the company also has its own set of catalysts driving this stock today.
Let’s dive into the three big reasons Nio is seeing some buying pressure right now.
NIO Stock Surging on a Range of Catalysts
The first catalyst many investors have their eye on with Nio is a continued expansion into Europe. In late-April, Nio announced its entry into Europe by way of Norway. The company is already commercializing its vehicles in Europe, so this isn’t necessarily new information. However, earlier this week, Nio announced it will enter the German market by 2022. Indeed, Germany is widely considered to be the crown jewel of the European market. Accordingly, investors are cheering this news in a big way.
This expansion into Germany has also been coupled by a market report released today. This report suggests the battery-as-a-service market will represent a massive opportunity in Europe. Indeed, Nio’s business model, which is built upon battery leasing, could make investors in NIO stock key beneficiaries. Which brings us to the final catalyst for Nio.
Today, Nio announced its first second-generation battery swap location in the highway service area. Indeed, it appears Nio is making a move at becoming the infrastructure leader in terms of battery swap locations in China. For investors in Nio, this is very exciting news. After all, the Chinese EV market is the largest in the world. If Nio can maintain its dominance in this market, investors stand to benefit from this increased infrastructure spending over the long term.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
