U.S. stocks aren’t the only ones rising. Chinese equities are also soaring on reports that a trade deal has been reached with the administration of U.S. President Donald Trump.
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Leading Chinese technology names Alibaba (BABA) and JD.com (JD) are each up 6% at noon hour on May 12, while electric vehicle maker Nio’s (NIO) stock has gained 5%. Chinese stocks are getting a big lift from news that officials in Washington, D.C. and Beijing have agreed to substantially lower the tariffs they’re charging on each other’s imports.
The U.S. has agreed to lower its import duties on Chinese products to 30% from 145%, while China has taken its levies on American goods down to 10% from as high as 125%. Investors around the world are cheering news of the tariff relief between the two biggest economies.
Big Rally
Markets in the U.S. are enjoying a relief rally led by stocks of technology and microchip companies. However, Chinese equity markets are also seeing big gains on news of the trade deal reached with the Trump administration.
Hong Kong’s Hang Seng index, which is widely viewed as China’s benchmark bourse, rose 3% on May 12, matching the gain seen in the technology-laden Nasdaq Composite index stateside. Europe’s Stoxx 600 index rose about 1% on news of the U.S.-China trade deal.
The stock of Alibaba, one of China’s largest technology companies, has risen 57% this year.
Is BABA Stock a Buy?
The stock of Alibaba has a consensus Strong Buy rating among 16 Wall Street analysts. That rating is based on 16 Buy recommendations issued in the past three months. The average BABA price target of $167.13 implies 25.56% upside from current levels.
