China changes course
China has pledged to keep its stock markets more stable and take measures to boost economic growth this morning, sending shares of tech companies Alibaba and JD.com up more than 25% at the time of writing. For e-commerce giant Alibaba that news couldn't have come any sooner, as the company's share price has been in a slump for much of the last 18 months, which has had little to do with the company's fundamentals.
Thanks to its ties with founder Jack Ma, Alibaba has been in the cross hairs of China's big tech crackdown. That has meant that, despite growing its revenue more than 13x from 2014 to 2021, Alibaba's share price found itself below its IPO price as recently as yesterday.
Not the time for tough love
China may have lost its appetite for beating up on big tech given all that's happened in the last few weeks. Russia's closeness with China (the "no limits" friendship), a fresh outbreak of Covid-19 (which has meant lockdowns) and a tougher regulatory outlook for US-listed Chinese companies have all put Chinese assets deeply out of favor with global investors. The result is a supportive Chinese state for its biggest tech companies... for now.
