Chinese tech stocks are finally seeing daylight, as the sector led by $Alibaba(BABA)$ , $PDD Holdings Inc(PDD)$ , $TENCENT(00700)$ , $MEITUAN-W(03690)$ and $JD.com(JD)$ rallied over the week, lifted by improving market sentiments and optimism that the Chinese tech sector is finally on the mend. Since the crackdown on the tech sector a couple of years ago, the Chinese tech stocks had been so drastically beaten down that many lost over half their market capitalization, despite their sound earnings and solid fundamentals, resulting in highly attractive stock valuations now.
In fact, UBS has been raised its recommendation on the MCSI China Index to overweight in a rare upgrade call this year. The bullish call can't be more timely, as the tech sector emerges from its multi-year slump, thanks to signals of an end of the earlier crackdown and narratives of supportive regulative measures. Although geopolitical tensions persist, there have been recent signs of improving corporate performance amidst recovery of the Chinese economy. In fact, Meituan is set to debut in Riyadh as expansion beyond China gathers steam.
With an improved risk-reward outlook, now may be the time to rotate back into the Chinese tech sector for long-term growth, as its recovery gathers momentum. I believe that the Chinese tech sector is finally seeing light at the end of the tunnel.
@MillionaireTiger @VideoLounge @CaptainTiger @TigerStars @TigerWire @TigerEvents
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