Pedestrians walk past a Nio Inc. showroom in Beijing, China
Qilai Shen/Bloomberg
Stock in Chinese electric-vehicle maker NIO is now listed on two stock exchanges: The New York Stock Exchange and the Hong Kong stock exchange. Shares made their debut in Hong Kong Thursday. They dropped.
NIO (ticker: NIO) shares dropped 0.7% in overseas trading, closing at 158.90 Hong Kong dollars after opening at HK$160. The U.S. to Hong Kong dollar exchange rate is 7.82. The HK$158.90 level corresponds to a U.S. share price of $20.32.
NIO shares closed in New York at $20.17 on Wednesday. It looks as if Hong Kong investors were following the U.S. market in Thursday’s overseas trading.
Prices for dual-listed stocks don’t have to match, but they should be close. And investors can track prices on dual-listed shares to get a sense of where a stock might be headed in either market from day to day.
NIO shares traded lower in the U.S. on Thursday, down 13% to $17.52. The S&P 500 fell 0.5% and the Dow Jones Industrial Average was off about 0.4%.
But the Thursday U.S. drop follows a big rise Wednesday. NIO shares rose 12% in Wednesday trading in the U.S. on what was a big day for all U.S. stocks. The S&P 500 and Dow Jones Industrial Average rose 2.6% and 2%, respectively. The Nasdaq Composite rose 3.6%.
The big bounce was a welcome reprieve for investors. Coming into Thursday trading, NIO stock is still down about 36% so far in 2022 and down more than 60% from its July 2021 52-week high of more than $55 a share.
Rising interest rates, inflation and the Russia-Ukraine conflict have sapped some investor willingness to hold high-growth stocks. The Russell 1000 Growth Index has underperformed the Russell Value Index by more than 10 percentage points so far in 2022.
NIO qualifies as a growth stock. The company isn’t expected to be profitable in 2022, but sales are expected to rise by about 80%.
Write to Al Root at [email protected]
