JPMorgan has upgraded Chinese tech stocks on the back of diminished risks, just two months after calling the sector “uninvestable.”
JPMorgan's Yao did not immediately respond to CNBC's request for comment on the claims made in Bloomberg's report.
Even before the bank's March call, Chinese internet stocks were already taking a beating — hammered by months of regulatory uncertainty and worries over supply chain disruptions from the mainland's strict zero-Covid policy. The Hang Seng Tech index which tracks the largest Hong Kong-listed technology stocks has fallen more than 27% this year, as of Monday's close.
Concerns over a higher interest rate environment as major central banks look to tame hot inflation have also been an overhang for the broader tech sector globally. Rising rates tend to make future earnings for growth companies look less attractive.
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