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Are Alibaba shares “just too cheap?” [Video]

That’s the view of Tony Roberts from the Invesco Fund. Interviewed this week, Roberts was reported via Bloomberg as saying that China’s big tech companies like Alibaba and Tencent are “just too cheap.”  This call comes as the latest Chinese export data shows an unexpectedly large fall of 7.5% y/y, prompting hopes of more stimulus from the People’s Bank of China via a rate cut.

Alibaba Group is a multinational conglomerate and one of the world’s largest e-commerce companies, based in China. Jack Ma founded the business in 1999, and it has since developed into a major force in many facets of the digital economy.

Is China about to get some extra stimulus from the People’s Bank of China? If it is, could Alibaba shares find a sudden gain? Seasonally, Alibaba shares have a stronger period ahead. Over the last 8 years, Alibaba has gained an average of 5.84% from June 2 to July 21.

So, will we see Alibaba gains on hopes of Chinese stimulus as we head into the weekend?

Major trade risks: The biggest risk here has to do with the recovery of China’s economy. A slower-than-expected pick-up could continue to disappoint analysts.

 

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Giles Coghlan LLB, Lth, MA

Giles is the chief market analyst for Financial Source. His goal is to help you find simple, high-conviction fundamental trade opportunities. He has regular media presentations being featured in National and International Press.

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