Zacks Investment Ideas feature highlights: iShares China Large Cap ETF, Alibaba, JD.com, Baidu and Futu

For Immediate ReleaseChicago, IL – December 3, 2024 – Today, Zacks Investment Ideas feature highlights iShares China Large Cap ETF FXI, Alibaba BABA, JD.com JD, Baidu BIDU and Futu Holdings FUTU.Trump Threatens Tariffs: Are Chinese Stocks Doomed?Chinese Stocks Fall After US Election ResultsThe Chinese economy and equity market have been in a slump for years, triggered by a real estate crisis, anti-business government policies, a high unemployment rate among youth, and strict lockdowns in the wake of COVID-19. That said, Chinese stocks exploded in September as the government announced a sweeping stimulus package and institutional investors like David Tepper and Michael Burry piled into equities.For September, the iShares China Large Cap ETF launched 20%. Following the spike, profit takers emerged, and FXI bled lower. After the results of the US presidential election showed Trump as the winner, the downside acceleratedTrump, known for his pro tariff economic stance (especially toward China), was the culprit.Trump Threatens China with New TariffsLast week, President-elect Trump announced that he plans to immediately hike tariffs on Chinese goods entering the US by 10%. In a Truth Social post, Trump warned:“I have had many talks with China about the massive amount of drugs, in particular Fentanyl, being sent into the United States – but to no avail. Representatives of China told me that they would institute their maximum penalty, that of death, for any drug dealers caught doing this but, unfortunately, they never followed through, and drugs are pouring into our country, mostly through Mexico, at levels never seen before. Until such a time as they stop, we will be charging China an additional 10% Tarriff, above any additional Tariffs, on all of their many products coming into the United States of America. Thank you for your attention to this matter.”Despite the heated rhetoric, below are five reasons Chinese stocks are a good bet here, including:1. US is Negotiating from Position of Strength = Fast Resolution The US trade deficit with China is overwhelming, approaching nearly $85 billion in September. Because the imbalance is slanted in one direction, China will likely look to negotiate and resolve the trade dispute (which they showed a willingness to do in Trump’s first term. Furthermore, China showed some goodwill late last week by releasing three Americans long held in Chinese prisons. Finally, FXI has been up since the tariffs were announced, signaling that the news is already priced into the market.2. Stimulus Package Stocks run on liquidity, and earlier this year, the Chinese government showed that they are looking to provide it through a sweeping stimulus package. Historically, when the Chinese government wants to boost its economy, they go all out and leave no stone unturned. With this in mind, more stimulus is likely on the horizon.Meanwhile, Chinese regulators recently reversed their anti-crypto stance to legalize Bitcoin ownership. Chinese blockchain operator SOS gained over 100% intraday last week after the company announced it would add $50 million worth of Bitcoin to its balance sheet.3. Chinese Stocks Are CheapAlibaba is an excellent proxy for Chinese stocks. Chinese stocks like BABA and JD.com enjoy historically cheap valuations. Meanwhile, companies like Baidu are poised to cash in on the AI boom.4. China Technical ViewSeveral leading Chinese stocks, like Futu Holdings,are flushing out bears and are forming bullish double-bottom base structures.5. Record Outflows = Bearish Retail SentimentBloomberg reported that Chinese ETFs have seen their most significant monthly outflows on record. Such outflows suggest that sentiment (a contrarian indicator) for Chinese equities is near rock bottom levels.Bottom LineDespite tariff threats from the incoming Trump administration, Chinese equities are stabilizing. Cheap valuations, strong technicals, and low valuations make Chinese stocks a buy into 2025.Why Haven't You Looked at Zacks' Top Stocks?Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.Today you can access their live picks without cost or obligation.See Stocks Free >>Media ContactZacks Investment Research800-767-3771 ext. 9339support@zacks.comhttps://www.zacks.comPast performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 228 positions with double- and triple-digit gains in 2023 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Baidu, Inc. (BIDU): Free Stock Analysis Report iShares China Large-Cap ETF (FXI): ETF Research Reports JD.com, Inc. (JD): Free Stock Analysis Report Alibaba Group Holding Limited (BABA): Free Stock Analysis Report Futu Holdings Limited Sponsored ADR (FUTU): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks