Chinese ADRs finally getting some relief: Baidu Inc (ADR) (BIDU), Vipshop Holdings (VIPS), Bitauto (BITA), Qunar Cayman (QUNR), Qihoo 360 Technology (QIHU), YY Inc (ADR) (YY)
By Chad Roskin From Markets Emerging
Chinese ADRs made noteworthy gains and were among top performers in the U.S. market Tuesday as investors are still optimistic about the China’s announcement last week that it is getting prepared launch new stimulus measures aimed at boosting GDP. Chinese stocks also saw gains as the yuan continues to slide vs. the U.S. dollar, making China-made goods more competitive internationally and at home.
The Bloomberg China-US Equity Index, the measure of the most-traded U.S.-listed Chinese companies, added 2.4 percent in New York in yesterday.
“The market’s expectations about stabilizing growth through infrastructure construction are building up,” said Wu Kan, a money manager at Dragon Life Insurance Co. in Shanghai, which oversees about $3.3 billion. “Technological stocks will get some relief after falling over the past weeks.”
Qunar Cayman Islands Ltd (NASDAQ:QUNR) soared 14.65% yesterday on rumor QUNR, a unit of China’s largest Internet search firm Baidu Inc (ADR) (NASDAQ:BIDU), is in discussions to merge with Ctrip.com International Ltd. (CTRP).
The talks include a range of possibilities, from a full-blown merger to a partnership, and are in the preliminary stages and may not result in a final deal. Bloomberg reported the ownership structure and financing methods haven’t been decided.
Vipshop Holdings Ltd – ADR (NYSE:VIPS) climbed 11.12% after analysts at Credit Suisse upgraded the stock to “outperform” from “neutral” and raised their PT to $178 from $145, expecting the Chinese holding company as a stable buy in a volatile sector and believed growth in cosmetics and baby products would be particularly strong this year.
“Amid recent sector volatility, we recommend investors to accumulate quality names such as VIPS at reasonable valuation.” Credit Suisse said. “Growth in new key categories such as cosmetics and mother/baby goods are strategic focus for 2014.”
Among other China-based companies, Bitauto Hldg Ltd (ADR) (NYSE:BITA), Qihoo 360 Technology Co Ltd (NYSE:QIHU) and YY Inc (ADR) (NASDAQ:YY) each rose at-least 7% on Tuesday, all showing rebound as high-growth stocks were getting ditched in the past few days.
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