Why Is SunCar Technology Stock Rallying Today?

SunCar Technology Group Inc. (SDA) on Wednesday announced that it has entered a new phase of strategic cooperation with Chinese EV maker Nio  Inc. (NIO) on the heels of the launch of new models.

The cloud-based auto insurance service provider said that SunCar will continue to provide car owners with innovative auto insurance solutions available in China following the launch of Nio’s new car models, including the ES8 SUV and the cheaper Onvo L90 model.

Nio opened pre-orders for the all-new ES8 three-row SUV earlier this month. The vehicle is slated to be officially launched in late September.

On Stocktwits, retail sentiment around SDA stock stayed within ‘bearish’ territory over the past 24 hours, while message volume rose from ‘normal’ to ‘high’ levels. Shares of the company traded 3% higher at the time of writing.

Meanwhile, retail sentiment around NIO trended in the ‘extremely bullish’ territory, coupled with ‘extremely high’ retail chatter. Shares of the company traded 4% lower at the time of writing.

A Stocktwits user said that Nio stock is down today as it ran up too fast.

SunCar has partnered with Nio since 2020, and in late 2023, it upgraded its Anji Cloud Service Center with new service capabilities to provide NIO car owners with more detailed and customized auto insurance services.

Last month, SunCar also said that its Xiaomi partnership has progressed further with the launch of the latter’s YU7 SUV.

Separately, JPMorgan upgraded Nio to ‘Overweight’ from ‘Neutral’ earlier this week while hiking the price target to $8 from $4.80 on the hopes that multiple events toward year-end will further lead the stock north. JPMorgan is now looking forward to Nio’s second-quarter earnings due on September 2, the formal price announcement of the company’s new ES8 SUV, and the annual Nio Day event on September 20, among others.

While SDA stock is down by 75% this year, NIO stock soared 48%. 

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