Alibaba, JD Shares Riding High In Friday Pre-Market: What's Going On?
Alibaba and JD shares surged in pre-market trading following the People's Bank of China's announcement of economic stimulus measures, including a reduction in cash reserve requirements for banks. This move aims to support the struggling property market and boost the Chinese economy amid ongoing challenges such as weakening consumer demand and trade tensions with the U.S. Notable investors, including David Tepper, are becoming more bullish on Chinese stocks, indicating a potential recovery in the tech sector, which is vital for the global technology industry.
Alibaba Group Holding Ltd BABA and JD.Com Inc JD saw significant gains after China’s central bank revealed new economic stimulus measures.
What Happened: The market rally follows the People's Bank of China announcing a reduction in the amount of cash banks need to hold and outlining plans to support the struggling property market. These measures aim to boost the Chinese economy, CNBC reported on Friday.
As per Benzinga Pro, Alibaba was up 2.17% and trading at $106.81 at the time of writing while JD was up by 4.90% and trading at $39.65 simultaneously.
Big-name investors like billionaire hedge fund founder David Tepper have become more bullish on Chinese stocks, with Tepper buying more shares in companies like Alibaba and Baidu after the U.S. Federal Reserve cut interest rates this month.
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Why It Matters: The Chinese government’s recent economic stimulus measures are part of a broader effort to stabilize its economy amid ongoing challenges. The Chinese economy has been grappling with a property market slump, weakening consumer demand, and trade tensions with the U.S. These issues have prompted the government to take action to prevent a deeper economic downturn.
Additionally, the U.S.-China trade tensions have had a significant impact on global markets, influencing investor sentiment and economic policies in both countries. The recent stimulus measures by China are seen as an attempt to mitigate these effects and restore confidence in its markets.
Furthermore, the recovery of China’s tech sector is crucial for the global technology industry. Companies like Alibaba, Tencent, and Meituan play a significant role in the global tech ecosystem, and their performance can have ripple effects across international markets.
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Disclaimer: This content was partially produced with the help ofBenzinga Neuroand was reviewed and published by Benzinga editors.
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