As the week carries on, the Chinese government continues to crack down on Chinese tech stocks and other plays listed overseas. However, some stocks seem to be making a recovery even without officials easing their attack. The EV sector in particular is gaining in the midst of a bearish period. So, what’s pushing Chinese EV stocks up today?
Things are heating up both overseas and within the U.S. Securities and Exchange Commission. China is now demanding tightened data security from 25 of its largest tech giants, including Tencent (OTCMKTS:TCEHY). It is also demanding these companies conduct internal reviews to uncover any illegal activities.
Meanwhile, the SEC is looking into new disclosures for overseas companies looking to conduct IPOs in the U.S. market. This all comes after DiDi (NYSE:DIDI), a Chinese ride-hailing giant, was rumored to go private just after its public offering, to appease Chinese regulators.
Chinese EV Stocks Show Immunity From Crackdowns
Through all of this pessimistic news, EV stocks are overcoming the adversity. Chinese EV stocks are gaining as a class today, most likely on the back of a single company’s good news. The news comes out of the Nio (NYSE:NIO) camp, which represents a devoted group of followers.
The automaker is tapping Ai Tiecheng to head its newest sub-brand. Tiecheng, formerly general manager of WeWork Greater China, will be the vice president of strategic business for the unnamed sub-brand. The brand will be launched by Nio, but it will exist as an independent brand. The new label will represent Nio’s mid- and low-end electric vehicles. Nio says the first model of this sub-brand will be released as early as the first half of 2022.
As a result of this news, it seems Chinese EV stocks are all seeing gains. Nio is up over 5% on the day’s session, while peers Li Auto (NASDAQ:LI) and Xpeng (NYSE:XPEV) are up 10.5% and 8.5%, respectively. As a refresher, we also saw these stocks gain earlier this week in response to a reassuring editorial from a Chinese state-owned business paper.
On the date of publication, Brenden Rearick 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.