U.S.-Listed China Companies Get Boost as State Funds Buy Stocks

A sign promoting Alibaba Group Holding Ltd.'s 11.11 Singles' Day online shopping event, center, at the company's headquarters in Hangzhou, China, on Wednesday, Nov. 10, 2021. Alibaba's annual shopping bonanza, one that draws in hundreds of millions of people across the globe, is a more low-key affair this year as the e-commerce giant seeks to turn the focus away from increasing sales and more toward sustainability and philanthropy -- key pillars of President Xi Jinping's drive to reshape China's economy. Photographer: Qilai Shen/Bloomberg , Bloomberg

Matt Turner, Bloomberg News

Feb 8, 2022

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(Bloomberg) -- Chinese stocks listed in the U.S. may finally be getting a much needed dose of good news after state-backed funds were said to have entered the local market to buy shares in order to help stem declines that have accelerated in recent weeks.

American depositary receipts of large-cap technology stocks including Alibaba Group Holding Ltd., JD.com Inc. and Pinduoduo Inc. all gained in premarket trading Tuesday. Meanwhile, shares of embattled ride-hailing firm DiDi Global Inc. and search engine giant Baidu Inc. each rose by as much as 2%.

READ: China State Funds Said to Buy Stocks to Stem Worsening Rout (1)

The buying by China’s so-called “national team” comes as the domestic stock market reopened for trading after being closed for a week due to its annual Lunar New Year holiday. Prior to that break, the nation’s benchmark equity gauge had fallen into a bear market amid growing concerns about the economy and a resurgence of Covid-19 cases.

U.S. investors are hoping that the renewed support from state funds will also help halt the selloff seen by shares listed outside of Mainland China. The Nasdaq Golden Dragon China Index -- which tracks firms on U.S. exchanges that conduct a majority of their business in China -- has plunged more than 60% since rising to a record last year, including a drop of 8.6% to begin 2022.

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