U.S.-listed China stocks have undergone a significant decline from their 2021 levels, leading CNBC’s Mad Money host, Jim Cramer, to suggest a potential opportunity to include some of these stocks in one’s portfolio.
Following a surprising rate cut by the People’s Bank of China, Cramer expressed his belief that the country is working to stimulate its stock market. He mentioned that historically, such actions have yielded positive results.
Alibaba Group Holding Limited (NYSE:BABA), Baidu, Inc. (NASDAQ:BIDU), and JD.com, Inc. (NASDAQ:JD) are predicted by Cramer to experience potential rallies. He advised considering these options, at least for the time being.
Cramer, who has been critical of China’s economic conditions, took to social media platform X (formerly Twitter) to express his astonishment at the country’s handling of its debt situation. He even outlined a plan for China, slated for release later this week.
Contrary to earlier assumptions, Cramer argued that the U.S. no longer relies heavily on China’s rapid growth for its own industries to thrive. He emphasized that the U.S. has diversified its growth avenues and is less dependent on China’s economic trajectory.
China’s economic recovery post-reopening has been marked by instability. Recent data on producer and consumer price inflation signalled the onset of inflation. Second-quarter GDP growth, at 6.3% year-over-year, fell short of the 7.3% forecasted by economists.
The most recent bank loan data disclosed a decline to levels not seen since late 2009. Furthermore, data from July indicated that retail sales, industrial production, and fixed asset investment all fell below expectations.
The ongoing financial challenges in China’s property sector are causing a ripple effect, raising concerns about broader economic implications on both a national and global scale.
Acknowledging the economic struggles, China’s Communist regime is displaying a willingness to intervene and mitigate potential consequences.