Wall Street is bullish on Chinese tech firms, even as recovery is uneven

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Analysts are bullish on China's tech industry even if recovery is not uniform across different tech companies.

related investing news"Baidu, Alibaba, Tencent reported — most of the earnings were a beat," Ronald Keung, head of Asia Internet Research at Goldman Sachs, told CNBC's "Street Signs Asia" Friday.

Alibaba missed analysts' revenue estimates, but revenue rose 2% year on year to hit 208.2 billion Chinese yuan . The tech giant's domestic commerce unit fell 3% in the first quarter, while the cloud business was down 2% — highlighting concerns that a Chinese consumer spending rebound may not be as strong as expected.

Noting the decline in Alibaba's shares, Jiong Shao, analyst at Barclays said on Friday, ahead of the weekend's Group of Seven summit: "I think that there have been some geopolitical concerns ... Investors are concerned about potential sort of a sanction against China and against Chinese companies." The leaders of the G-7 were in Hiroshima, Japan on the weekend to discuss global and regional issues, includingIn a joint statement G-7 leaders acknowledged that there's a need to de-risk and diversify from China — not decouple. They highlighted the need to "address challenges posed by China's policies and practices" and "counter malign practices, such as illegitimate technology transfer or data disclosure.

 

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