Predicting the returns of Chinese technology stocks is harder than ever in an age of shifting government policy, rising interest rates and cooling economies.
Take JPMorgan Chase & Co.’s Alex Yao. He downgraded 28 Chinese internet stocks in March, calling the industry “uninvestable” --- right before an epic rally. He then shifted to upgrade the sector in mid-May and, while indexes are higher since then, the biggest company, Tencent Holdings Ltd., is down nearly 20%. Alibaba Group Holding Ltd. is a hair’s breadth away from wiping out all the gains since Yao upgraded the stock.