Chinese Tech Giants Surge on News of Easing Regulation

Jan 09, 2023

Chinese Tech Giants

China's tech stocks are gaining a renewed appeal as the government is easing its grip on the sector after years of an intense regulatory crackdown, with renewed demand reigniting the market. This comes as a welcome relief for investors and analysts who had previously labeled the sector "uninvestable."

Alibaba Group Holding Ltd. led a 3.2% rise in the Hang Seng Tech Index (HSTECH) on Monday after China's top central banker announced that restrictions on the digital industry were coming to an end. Across the board, the stock market rose, with Hong Kong-listed Chinese shares gaining 2%.

This marks the end of pressure on a driving force of private enterprise in China. This news follows the government lifting strict restrictions on Covid-19 and providing assistance to the struggling real estate market. This shift has led to the growth of international markets, albeit at the cost of high-net-worth individuals like Jack Ma, who surrendered control of Ant Group Co. under regulatory pressure.

Chinese tech giant Alibaba could be set to outperform its peers in the upcoming year, with an improved regulatory climate and policy support for private businesses, according to Morgan Stanley analyst Gary Yu.

Alibaba's stock has been bolstered after founder Jack Ma announced his decision to give up control of Ant Group, the IPO of which was scuttled back in 2020, marking the beginning of a broad clampdown on the industry. Although the decision may delay a potential listing, it is consistent with authorities' intent to improve corporate management as part of a broader revision.

According to Goldman Sachs, the worst is over for Alibaba. The investment bank has added the Chinese tech giant to its conviction list following a two-year slide in earnings revisions, with a rebound in advertising revenues anticipated. Other prominent tech companies have also received upgrades from Goldman Sachs and Morgan Stanley strategists, primarily due to better-than-expected reopenings and improving regulatory conditions.

"For investors, this could signal the end of the regulatory pressure that followed Ant's IPO failure," commented Willer Chen, Forsyth Barr Asia's strategist. "It's good news for Alibaba's stock price and investor confidence."

The Jefferies Financial Group Inc. hiked Alibaba's stock price on Sunday, anticipating the company's performance to improve as China's economy recovers.

Nevertheless, the Chinese tech industry has undergone major changes in the past few years due to more strict regulatory oversight of data protection and online gaming. During its peak in 2020, Alibaba stock reached HK$307.40, a long way from Monday's day's close of HK$110.40. Bloomberg's analysts expect Alibaba stock to reach a target price of HK$134.85.

Besides Alibaba, there are other companies. As of Monday, Tencent's stock was trading at HK$362, about half the value it reached at its peak in 2021.

Currently, investors are optimistic about the prospects, as HSTECH has gained over 60% since the low set in October. Asia's stock market rallied Monday, setting up a technical bull market for the MSCI index.

In general, Chinese shares are showing an improvement in the overall outlook as growth-promoting measures go into effect and the country's borders reopen. Goldman forecasts the Chinese stock market to grow 15% more, thanks to attractive valuations and shifts in policy in sectors like real estate.

Subscribe Our Newsletter

Intel Stock Forecast Is Pretty Pessimistic Despite Its Plan. This Is Why.

Milena

Intel Stock Forecast Is Pretty Pessimistic Despite Its Plan. This Is Why.

According to Chief Financial Officer David Zinsner, the company's foundry division will play a big part in cutting costs by $3 billion in 2023, thus Intel stock forecast is not too optimistic.

Stocks
Story of Big Tech Giant Apple Will Not Be About Growth This Time.

Milena

Story of Big Tech Giant Apple Will Not Be About Growth This Time. However, Bulls Believe in The Opposite.

Big tech giant Apple's sales are expected to be somewhat lower than a year ago, according to consensus projections. However, a slew of bullish analysts predict brighter times ahead.

Companies
B2BROKER Liquidity B2BROKER Liquidity
Sponsored
Constantine

Prop Trading: What Is It And How Does It Work?
Explore the world of prop trading and learn about what it is, its benefits, and what varieties exist today.

discover
Differences Between Fiat and Crypto Processors

Oliver

Differences Between Fiat and Crypto Processors

The number of people using Bitcoin has grown exponentially in the last few years. According to recent data by BitInfoCharts, the total market value of all existing Bitcoin reaches $388 billion, and this number is only expected to grow in the future. It is not difficult to understand why businesses want to accept cryptocurrency payments.

Crypto Payments
Contact us bg

Contact Us

Contact the Liquidity Provider
for any questions and advertising inquiriesb2broker

    Please fill out this contact form to get in touch with us

    / 3000

    By clicking “Get in touch” button, you agree to the privacy policy

    Successful!
    Thank you for your request.
    We will contact you shortly.
    Close

    Hazem

    MetaTrader vs cTrader: Which Trading Platform Shall You Choose?

    MetaTrader vs cTrader: The Full Breakdown

    Сonstantine

    Will Dogecoin Reach $1? Tokenomics and Price Analysis

    Will Dogecoin Reach 1 Dollar Analysis

    Сonstantine

    How to Get a Crypto Exchange License?

    How to Get Crypto Exchange License

    Сonstantine

    Best Crypto to Buy Now: Guide for Investors

    Best Crypto To Buy Now

    Hazem

    Grok vs ChatGPT: What’s the Best AI Assistant You Need in 2025

    Grok vs ChatGPT

    Сonstantine

    How to Choose the Right Liquidity Provider for Your Brokerage

    How to Choose the Right Liquidity Provider for Your Brokerage

    Сonstantine

    Low-Latency Trading Defined: Speed, Strategy and Technology

    Low-Latency Trading Explained

    Hazem

    How Liquidity Depth Affects Slippage in High-Volume Trading

    Liquidity depth and slippage in trading

    Hazem

    What is FIX API Liquidity Connection and How Does it Power Institutional Trading?

    FIX API in institutional trading

    Сonstantine

    OTC Trading Strategies and Technologies to Succeed in Over-the-Counter Markets

    OTC Trading Strategies

    Alexander

    What is OTC Trading? A Complete Guide for 2025

    what is OTC

    Alexander

    Synthetic Futures: A Trader’s Guide to Replicating Positions with Options

    How to Trade Synthetic Futures

    Сonstantine

    Order Book Depth: What It Is And Why It Matters?

    Order Book Depth What It is And Why It Matters

    Alexander

    Spot vs Perpetual Futures: Which Is Right for You?

    Spot vs Perpetual Futures explained

    Hazem

    5 Reasons Traders Are Switching to Perpetual Futures

    5 Reasons to Switch to Perpetual Futures

    Constantine

    Top 3 Liquidity Challenges Facing New Exchanges and How to Solve Them

    Top 3 Liquidity Challenges Facing New Exchanges Today

    Constantine

    Financial Planning in the Cryptocurrency Era — Master Crypto and Digital Asset Strategies

    Financial Planning in the Cryptocurrency Era

    Hazem

    Best Platforms to Trade Perpetual Futures in 2025

    Best platforms to trade perpetual futures in 2025

    Alex

    Top 10 Fintech Website Development Agencies for 2025

    Best Fintech Website Development Agencies for 2025

    Сonstantine

    Internal vs External Range Liquidity In ICT Trading Explained

    Internal vs External Range Liquidity In ICT Trading

    Constantine

    Portfolio Backtesting — Tools, Metrics, and Methods Explained

    Portfolio Backtesting

    Сonstantine

    ICT Trading Explained: Smart Money Concepts, Tools and Setups

    ICT Trading Explained

    Сonstantine

    CFD Trading Strategies: A Practical Guide to Risk and Execution

    CFD Trading Strategies

    Alexander

    What is a Fair Value Gap? A Guide to Trading Market Imbalances

    What is Fair Value Gap
    liquidity-provider-logo
    • News
      • Stock Market Forecast
      • Stocks
      • Banks and Finance
      • Companies
      • Crypto
      • Forex
      • AI
      • Technology
      • DeFi
      • NFT
    • Articles
      • Crypto Payments
      • Trading
      • Crypto Exchange Business
      • Forex Business
      • Fintech
      • Liquidity
      • FinTech Awards
      • Blockchain
      • Investing
      • NFT
      • DeFi
    • More
      • Videos
      • Liquidity Providers List
      • Crypto Payment Providers
      • White Label Brokerage Platforms
      • Broker CRM Platforms
    [email protected]

    © 2024 Liquidity Provider. All Rights Reserved

    Privacy Policy Cookie Policy
    This site is registered on wpml.org as a development site. Switch to a production site key to remove this banner.