maybefalse/iStock Unreleased via Getty Images
maybefalse/iStock Unreleased via Getty Images
JD.com (NASDAQ:JD), Alibaba (NYSE:BABA) and other Chinese Internet companies scored mild gains Monday amid reports of Beijing taking new steps to support China’s economy, and also loosening of some of the country’s stringent Covid policies.
Over the weekend, China’s central bank put forth a 16-point plan aimed supporting country’s domestic property market, which was seen as boosting financing among developers and leading to broader support for China’s economy.
Additionally, more reports emerged that said China was easing up a bit on Covid policies such as mandatory quarantining for travelers coming into the country, and contact tracing practices.
And with the end of China’s big Singles Day retail season on Friday, there was growing sentiment that the likes of Alibaba (BABA), JD.com (JD) and other e-commerce companies could see their end-of-the-year sales getting a small, if needed boost.
Alibaba (BABA) shares edged up by 2%, Monday, while JD (JD) climbed more than 4%, Baidu (NASDAQ:BIDU) was up by 2%, and Tencent Holdings (OTCPK:TCEHY) and NetEase (NTES) both nudged upward by 1%.
The KraneShares CSI China Internet ETF (KWEB) rose 2%.
At Mizuho Securities, analysts James Lee and Wei Fang called JD.com (JD) and Baidu (BIDU) their top picks in the Chinese Internet sector, but still remained cautious about the road ahead.
In a research report, Lee and Fang said that they anticipate JD (JD) and Baidu (BIDU) “to be market-share gainers from regulatory policies and [a] competitive environment.” Lee and Fang said that channel checks suggest JD’s (JD) revenue grew from June to August, showed modest gains in September, and that the company’s third-quarter sales should grow by 11% from a year ago.
With regards to Baidu (BIDU), Lee and Fang said the company might see its third-quarter sales dip from a year ago, but it’s “on track to gain market share in cloud due to increased demand in public sectors and potential upside from autonomous driving.”
Along with attention on the Chinese Internet sector, Wall Street also sussed out the state of U.S.-China relations following a meeting between President Joe Biden and Chinese leader Xi Jinping one day before the start of the G20 summit in Bali.