Tech investors have expressed their readiness as China abandons its strict zero-COVID policy.
Alibaba is up 19%, Tencent is up 18%, Baidu is up 26%, and NetEase is up 21%, as of the close on Monday.
The Chinese government vowed to increase domestic consumption and growth in 2023 in December. Weighted down by severe COVID controls and a property downturn, China's GDP grew by only 3% in 2022, considerably below the official goal.
"I think the government has a clear signal about what they hope to do this year in terms of gross domestic product growth, jobs and domestic consumption," Chibo Tang, managing partner at Gobi Partners, which invests in early-stage tech and media companies in China, said (via CNBC).
New obstacles on the regulatory front reportedly do not concern investors.
Beijing has lately allowed access to a U.S. accounting watchdog, assisting in the resolution of an audit dispute that threatened to delist Chinese companies from U.S. exchanges. China also resumed the issuance of licenses for imported video games and authorized a new financial injection into a large fintech company.
In a report, Morgan Stanley stated that China's Central Economic Work Conference endorsed the importance of platform firms in driving economic growth and generating employment.
"This suggests Big Tech regulation has entered an institutionalized and stable stage, and we don't expect new, aggressive measures any longer," the report said.
In addition to supporting the digital economy, the conference emphasized that China will continue to improve the level of "normalized supervision" which, according to Wang Xianlin, a member of the expert advisory group of the State Council's anti-monopoly commission, is intended to create a more predictable business environment.
"This means that the country will avoid sudden, intensive and special rectifications of improper behavior in the platform economy in the future, which will be another firm support for platform companies to develop," he said.
In an interview with CNBC on January 17, Laura Wang, managing director and chief China equity strategist for Morgan Stanley, said, "We haven't recommended investing in Internet names for a long time, between January 2021 and all the way to December 2022, especially with skepticism surrounding the Internet sector."
"But we believe now is the time to get back in there. The Internet sector actually has very high correlation with the general momentum of consumption pickup in China and we know that that is about to happen post-COVID recovery," she added.
