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May 17, 2022, 1:20 p.m. EDT

China ADSs are flying as fading regulatory headwinds send iQIYI, NIO and Alibaba stocks surging

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By Tomi Kilgore

The U.S.-listed shares of China-based companies, surged Tuesday, particularly in the internet sector, as an apparent reduction of regulatory scrutiny has emboldened Wall Street analysts and investors to bet on an extended bounce.

The iShares MSCI China exchange-traded fund /zigman2/quotes/206267952/composite MCHI -0.23% rallied 2.5% in morning trading and the KraneShares CSI China Internet ETF /zigman2/quotes/205873167/composite KWEB -0.89% hiked up 2.4%, with 42of 48 components gaining ground. In comparison, the S&P 500 index /zigman2/quotes/210599714/realtime SPX +0.25% rose 1.2%.

Chinese Vice-Premier Liu He, the country’s top economic official, said overnight that the government supported the development of the sector and public listings for technology companies, suggesting a crackdown on U.S.-listings of China-based tech giants was easing.

Among the more active American depositary shares (ADS), NIO Inc.’s /zigman2/quotes/204905836/composite NIO +4.44% charged up 11.1% in midday trading, and have soared 27.1% amid a four-day win streak, which followed a 22-month closing low last Thursday. Trading volume of 56.8 million shares made the stock the most actively traded on the NYSE.

Tuesday’s rally comes after BofA Securities turned bullish on NIO, citing valuation coupled with easing regulatory pressures. Read more about BofA’s upgrade of NIO.

Shares of iQIYI Inc. /zigman2/quotes/203657421/composite IQ -2.50% , which are among the most actively traded on the Nasdaq, ran up 5.6%, and have rocketed 35.3% amid a four-day win streak.

On Monday, the ADS shot up 14.8% after J.P. Morgan upgraded the streaming -video company , as well as a number of other China-based internet companies, as recent “significant uncertainties” have started abating on the back of recent regulatory announcements.

Alibaba Group Holding Ltd.’s ADS /zigman2/quotes/201948298/composite BABA -1.82% got a 4.4% bump in midday trading. J.P. Morgan’s Alex Yao pulled a bullish about-face on the ecommerce giant, double upgrading it to overweight from underweight on Monday, as he believes historically low valuation offers “attractive risk/reward” in an improving macro environment.

Among other companies Yao double upgraded on Monday, the U.S.-listed shares of Tencent Holdings Ltd. /zigman2/quotes/207908563/delayed TCEHY +0.40% /zigman2/quotes/204605823/delayed HK:700 +2.02% rose 3.2%, Meituan /zigman2/quotes/203767197/delayed MPNGY -0.36% /zigman2/quotes/205161725/delayed HK:3690 +1.45% advanced 3.2%, Pinduoduo Inc. /zigman2/quotes/208876581/composite PDD +0.02% ran up 4.9%, NetEase Inc. /zigman2/quotes/201683625/composite NTES -0.69% /zigman2/quotes/218787563/delayed HK:9999 -0.07% gained 0.3% and Dingdong Ltd. /zigman2/quotes/227698451/composite DDL -1.54% jumped 2.7%.

JD.com Inc.’s ADS /zigman2/quotes/205122565/composite JD +1.00% charged up 1.6%, and was also one of the most active on the Nasdaq, after the ecommerce company reported earlier Tuesday first-quarter profit and revenue that beat expectations by wide margins. The company was also upgraded by Yao, who raised the rating to neutral from underweight.

Elsewhere, share of Baidu.com /zigman2/quotes/209050136/composite BIDU +0.44% rose 3.0%, Bilibili Inc. /zigman2/quotes/207131615/composite BILI -0.86% gained 2.7% and Vipshop Holdings Ltd. /zigman2/quotes/205727205/composite VIPS -2.77% tacked on 3.4%.

Outside of tech, the ADS of education companies were also broadly higher, with TAL Education Group /zigman2/quotes/203067931/composite TAL -1.72% rallying 4.4%, New Oriental Education & Technology Group Inc. /zigman2/quotes/201429187/composite EDU -1.57% rising 4.2% and Gaotu Techedu Inc. /zigman2/quotes/212597937/composite GOTU +8.53% adding 3.0%.

/zigman2/quotes/206267952/composite
US : U.S.: Nasdaq
$ 56.07
-0.13 -0.23%
Volume: 6.95M
Jan. 27, 2023 4:15p
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/zigman2/quotes/205873167/composite
US : U.S.: NYSE Arca
$ 35.83
-0.32 -0.89%
Volume: 14.56M
Jan. 27, 2023 4:00p
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
4,070.56
+10.13 +0.25%
Volume: 0.00
Jan. 27, 2023 5:10p
loading...
/zigman2/quotes/204905836/composite
US : U.S.: NYSE
$ 12.71
+0.54 +4.44%
Volume: 69.73M
Jan. 27, 2023 4:02p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$19.99 billion
Rev. per Employee
N/A
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/zigman2/quotes/203657421/composite
US : U.S.: Nasdaq
$ 6.24
-0.16 -2.50%
Volume: 15.88M
Jan. 27, 2023 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$4.99 billion
Rev. per Employee
$751,134
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/zigman2/quotes/201948298/composite
US : U.S.: NYSE
$ 118.38
-2.19 -1.82%
Volume: 18.03M
Jan. 27, 2023 4:00p
P/E Ratio
318.48
Dividend Yield
N/A
Market Cap
$317.35 billion
Rev. per Employee
$515,403
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/zigman2/quotes/207908563/delayed
US : U.S.: OTC
$ 52.55
+0.21 +0.40%
Volume: 2.40M
Jan. 27, 2023 3:59p
P/E Ratio
18.78
Dividend Yield
0.34%
Market Cap
$502.81 billion
Rev. per Employee
$750,206
loading...
/zigman2/quotes/204605823/delayed
HK : Hong Kong
$ 415.00
+8.20 +2.02%
Volume: 18.63M
Jan. 27, 2023 4:08p
P/E Ratio
18.99
Dividend Yield
0.39%
Market Cap
$3936.30 billion
Rev. per Employee
$5.87M
loading...
/zigman2/quotes/203767197/delayed
US : U.S.: OTC
$ 44.36
-0.16 -0.36%
Volume: 55,476
Jan. 27, 2023 3:59p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$139.19 billion
Rev. per Employee
$318,634
loading...
/zigman2/quotes/205161725/delayed
HK : Hong Kong
$ 174.90
+2.50 +1.45%
Volume: 19.44M
Jan. 27, 2023 4:08p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$1089.68 billion
Rev. per Employee
$2.49M
loading...
/zigman2/quotes/208876581/composite
US : U.S.: Nasdaq
$ 104.68
+0.02 +0.02%
Volume: 5.90M
Jan. 27, 2023 4:00p
P/E Ratio
34.57
Dividend Yield
N/A
Market Cap
$132.36 billion
Rev. per Employee
$1.84M
loading...
/zigman2/quotes/201683625/composite
US : U.S.: Nasdaq
$ 91.65
-0.64 -0.69%
Volume: 816,019
Jan. 27, 2023 4:00p
P/E Ratio
18.05
Dividend Yield
1.65%
Market Cap
$57.51 billion
Rev. per Employee
$454,997
loading...
/zigman2/quotes/218787563/delayed
HK : Hong Kong
$ 144.70
-0.10 -0.07%
Volume: 2.81M
Jan. 27, 2023 4:08p
P/E Ratio
18.21
Dividend Yield
1.65%
Market Cap
$450.24 billion
Rev. per Employee
$3.56M
loading...
/zigman2/quotes/227698451/composite
US : U.S.: NYSE
$ 5.12
-0.08 -1.54%
Volume: 485,907
Jan. 27, 2023 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$1.11 billion
Rev. per Employee
$895,255
loading...
/zigman2/quotes/205122565/composite
US : U.S.: Nasdaq
$ 63.74
+0.63 +1.00%
Volume: 5.67M
Jan. 27, 2023 4:00p
P/E Ratio
448.87
Dividend Yield
0.00%
Market Cap
$100.00 billion
Rev. per Employee
$407,170
loading...
/zigman2/quotes/209050136/composite
US : U.S.: Nasdaq
$ 139.04
+0.61 +0.44%
Volume: 1.83M
Jan. 27, 2023 4:00p
P/E Ratio
74.62
Dividend Yield
N/A
Market Cap
$49.46 billion
Rev. per Employee
$414,984
loading...
/zigman2/quotes/207131615/composite
US : U.S.: Nasdaq
$ 27.78
-0.24 -0.86%
Volume: 5.43M
Jan. 27, 2023 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$11.49 billion
Rev. per Employee
$267,729
loading...
/zigman2/quotes/205727205/composite
US : U.S.: NYSE
$ 15.44
-0.44 -2.77%
Volume: 3.08M
Jan. 27, 2023 4:00p
P/E Ratio
12.15
Dividend Yield
N/A
Market Cap
$9.42 billion
Rev. per Employee
$2.02M
loading...
/zigman2/quotes/203067931/composite
US : U.S.: NYSE
$ 7.45
-0.13 -1.72%
Volume: 7.78M
Jan. 27, 2023 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$4.83 billion
Rev. per Employee
$79,749
loading...
/zigman2/quotes/201429187/composite
US : U.S.: NYSE
$ 43.93
-0.70 -1.57%
Volume: 1.21M
Jan. 27, 2023 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$7.55 billion
Rev. per Employee
$47,505
loading...
/zigman2/quotes/212597937/composite
US : U.S.: NYSE
$ 4.07
+0.32 +8.53%
Volume: 5.34M
Jan. 27, 2023 4:00p
P/E Ratio
29.47
Dividend Yield
N/A
Market Cap
$1.05 billion
Rev. per Employee
$53,602
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