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China's central bank cut its short-term interest rate for the first time in 10 months on Tuesday to restore market confidence and support a slowing economic recovery in the world's second-largest economy after the pandemic.

BABA

Alibaba

BABA
$88.54 $1.84 +2.12%
Capital Structure
Market Cap
202.3B
Enterpr. Val.
1.4T
Valuation
P/E
20.5
P/S
1.6
Dividends
Yield
0.2%
Payout
0.0%

I've been thinking about adding $BABA+2.1% stock for a while now too, and this is an interesting signal for me on the next developments in China.

The rate cut suggests a possible easing of long-term interest rates in the coming week and beyond as demand and investor sentiment weaken, strengthening the case for urgent policy stimulus measures to sustain growth.

A cut in short-term interest rates provides cheaper financing and is a tepid policy easing as China's economy has slowly begun to lose momentum due to stringent anti-pandemic measures and ongoing supply chain disruptions. The central bank cut its key medium-term lending rate by 0.1 percentage point to 2.85% a year.

What do you think? Does this change your view on China and investing in Chinese equities?


Which Chinese stocks are held by local investors?

From what I've seen, Nio, Baba and BYD are the most frequently mentioned.

Tencent and Alibaba + I had JD and Meituan distribution as a special two. Then I kept China Mobile, but when they took it off the NYSE my broker sold it to me.

It starts in China, where does it go from there?

I'd say maybe soon in the US too.

We'll see tomorrow. Maybe the Fed will surprise us.