JPMorgan said that China tech stocks are in a 'good buying spot' instead of the regulatory crackdown

JPMorgan-said-that-China-tech-stocks-are-in-a -good-buying-spot'-instead-of-the-regulatory-crackdown

May 12, 2021: -JPMorgan Asset Management is bullish on Chinese technology stocks even though regulators crackdown on internet giants in the mainland.

The shares of major Chinese tech companies like Alibaba, JD.com, and Meituan have tumbled as Beijing moved to rein in monopolistic behavior in internet giants.

Howard Wang, head of Greater China equities at JPMorgan Asset Management, says that the regulatory clampdown poses uncertainties in the near term. Chinese tech companies have the potential tail to grow, he said.

“If we look at these fundamentals, and you stretch over a longer period, I think we’re actually in a pretty good buying spot,” Wang told CNBC on Tuesday.

Wang said prices go down in Chinese tech shares because of the regulatory risks or investors rotating out of growth stocks appear overdone. That results in “pretty decent value” in some Chinese tech stocks, he added.

Wang said he likes large tech companies without naming specific stocks given their beaten-down valuation and potential for earnings to grow.

Shares of tech giant Alibaba in Hong Kong decreased by nearly 7.48% this year as of Monday’s close.  E-commerce companies JD.com and Meituan have decreased 16% and 10.8%, respectively.

Chinese tech firms are still expected to face a bumpy road in the next few months as the regulatory clampdown keeps going, said Wang. But the crackdown has so far been “rational,” he said.

“From our standpoint as investors, it’s kinda really just hunkering down, regarding the fundamentals, make sure your companies aren’t doing anything that will be unfair market practice,” Wang said.

“I think when we take that into context, it looks like a decent environment to be investing in these stocks. Tough over the next few weeks, but overall, these are the kinds of investments that you’d want to make in China,” he added.

Editor's Choice

Posts You Might Like

Teaching Value & Integrity | Steve Jani

The Fort McMurray First Nation Group of Companies is the wholly owned business entity of Fort McMurray 468 First Nation. It was established in 1987 as Christina River Enterprises, and the organization rebranded as FMFN Group in 2021. Providing Construction, Custodial, Petro-Canada Fuel & Convenience Store, and Transportation services to a broad portfolio of customers, the Group of Companies is creating financial stability and prosperity for the Nation.

A Resilient & Innovative Leader | Maushum Basu

Maushum Basu is a visionary leader who inspires his team with a clear, compelling purpose. Unafraid to take calculated risks, he understands that growth often stems from change and innovation. His deep commitment to both Airia Brands, Inc.

Directing with Courage & Precision | Martin Paquette

When speaking with Martin Paquette, one thing is immediately apparent: he’s honest. His transparency is refreshing. While many shy away from such vulnerability, Paquette sees it as a force to reckon with. The incredible emotional intelligence speaks to years of looking within—it’s also what allows him to acknowledge his mistakes gracefully and use them as opportunities to innovate.

An Innovative Thinker | Marina Charriere

Marina Charriere, CEO of Star Drug Testing Services, Star Drug Testing Services (Windsor Park), and First Defence Face Masks go hand in hand. Star is a drug and alcohol testing facility, and First D F M is a face mask company.

Leave us a message

Subscribe

Fill the form our team will contact you

Advertise with us

Fill the form our team will contact you​