Tech rally falters as Chinese tech firms fall out of favour – The Wall Street Journal
DUBLIN – Investors are apparently falling out of love with Chinese tech giants like Tencent, Baidu, and Alibaba, after some mixed financial reports. The mounting trade issues between the US and China – which are likely to hurt China a lot more than they hurt America – are also weighing on Chinese stocks. This raises questions about Naspers' reported plan to offload some of its Asian investments – surely now, with Chinese tech stocks faltering, is not the time. On the flip side, no one seems to be souring on the US tech giants that have led US stocks through the longest bull market in history. Surely, however, some of the factors that are dinging Chinese stocks should also be pulling down the likes of Facebook and Google? After all, both of those companies have reported lower-than-expected growth in key parts of their business, and there seem to be plenty of regulatory headwinds facing them and other US tech companies. Yet these stocks continue to shoot skyward. To me, this seems like an incongruity. Someone must be wrong in this situation – either people are wrong about the worsening picture in China, or they're wrong about the bright future for US tech companies. Definitely a space worth watching. – Felicity Duncan
By Akane Otani and Steven Russolillo
(The Wall Street Journal) One of last year's most profitable trades is breaking apart, thwarting expectations for global investors betting on a handful of U.S. and Chinese technology titans' enduring dominance.
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