Update Time：2025/02/20
Greater China assets surge
Challenges mount as multiple uncertainties weigh on US stocks
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1.Global investors increase holdings in greater China assets
On Monday, the 13F filing from billionaire investor David Tepper’s hedge fund, Appaloosa LP, revealed a significant increase in holdings of Chinese stocks and China-focused ETFs during Q4 of last year. Tepper, known as one of the most prominent China bulls among hedge fund investors, believes Chinese stocks are significantly undervalued compared to U.S. equities. His latest move underscores confidence in China’s stock market and economic outlook.
Back in late September, Tepper stated that after the Federal Reserve’s rate cuts, he made a bold bet on all China-related stocks. He noted that China’s economic stimulus exceeded his expectations, marking a major shift. Previously, he had already built positions in nearly all major Chinese tech stocks and suggested he might double his investment limits in China-related stocks. “I may have once said I wouldn’t exceed a 10-15% position limit, but that might not be true anymore,” Tepper remarked.
2.Multiple uncertainties weigh on US stocks
While Greater China assets have been surging, US stocks appear to be struggling. After experiencing major turbulence earlier this month, the S&P 500 and Nasdaq have climbed back near record highs. However, challenges remain as the market faces three major uncertainties:
A. Uncertain Rate Cuts: Recent CPI and PPI data for January exceeded expectations, while retail sales unexpectedly declined. Persistent inflation, coupled with a seemingly resilient economy, raises doubts about whether the market is still within the Fed’s control.
B. Tariff Risks: Trump’s commitment to tariffs should not be underestimated—not just against China, but as part of a broader U.S.-focused protectionist trade policy. The recently launched “reciprocal tariffs” may be just the beginning, and concerns over trade restrictions are unlikely to fade anytime soon.
C. Political Uncertainty: Recent aggressive moves by the Musk administration’s efficiency department have disrupted U.S. political norms and heightened tensions between the two major parties, adding further uncertainty to the country’s political landscape.
*Source: Bloomberg
*内容来源：彭博
Update Time：2025/02/20
Update Time：2025/02/20
Reassessing China’s assets after Deepseek’s surge
Following the explosive rise of DeepSeek, a key market perspective has emerged: it may be time to reassess the valuation of China’s entire asset market.
According to Deutsche Bank, China holds a dominant global position in manufacturing and services, spanning industries such as apparel, steel, shipbuilding, telecom equipment, electric vehicles, and now AI with DeepSeek. With China’s intellectual property gaining recognition and expanding at an unprecedented pace, the bank expects the long-standing “valuation discount” on Chinese stocks to diminish. Profitability could also exceed expectations due to policy support for consumption and financial liberalization.
Hedge funds are subtly shifting their stance on Chinese equities. Goldman Sachs’ latest Prime Services data indicates a moderate net inflow into both onshore and offshore Chinese stocks in January, signaling a rebound in risk appetite.
Looking at the past five years, Chinese stocks remain relatively cheap. As of February 17, the MSCI China Index’s forward P/E ratio stands at 12.5, far below the 22x P/E seen in 2021, suggesting room for further gains. However, with substantial profit-taking in the market, the likelihood of short-term corrections is increasing.
In the short run, caution is warranted in the Hong Kong stock market. However, if the focus remains on improving private enterprise conditions and policy shifts in China, more supportive measures can be expected in the future.
Source: Tiger Asset Management
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