In Late October 2022, the zero-covid policy in China reached a boiling point. Earlier that month, Foxconn workers walked off the job. Despite needing to complete their work term at the iPhone factory, they could not tolerate the lockdown.
At that time, the Chinese people organized protests throughout dozens of cities. In November 2022, markets accumulated China tech stocks. They realized that the government re-opening the economy would benefit the sector.
Gambling firms like MGM Resorts (MGM) would thrive when visitors from China returned. In the hard-hit education sector, China previously banned non-profits from growing.
The price of New Oriental Education (EDU) stock nearly doubled, from a sub-$20 low to close at close to $40.
Naturally, Alibaba (BABA) stock bottomed at $58.01 to close at $107.40 on Jan. 6. Investors are hoping that the worst is over for Alibaba. The government allowed its fintech unit, Ant Financial, to raise funds. BABA stock gained 20.5% in the last week alone.
The China tech rally could gain momentum. A sell-off is equally possible. Everything depends on government regulators. Few expected stocks in this country to perform the best in 2023.
For the opening week, China tech stocks shined. Their prospects are on the mend.
