Wall Street jumps on China stocks after Beijing wields stimulus ‘big guns’

Chinese stocks are on a tear after Beijing unveiled sweeping measures to jump-start economic growth and stabilise the property market. And prominent Wall Street figures, including billionaire investor David Tepper and Goldman Sachs’ Scott Rubner, are all in.

Tepper, who founded Appaloosa Management in 1993, is buying more of “everything” related to China after the stimulus measures exceeded expectations.

“I thought that what the Fed did last week would lead to China easing, and I didn’t know that they were going to bring out the big guns like they did,” Tepper said in a CNBC interview on Thursday.

In the second quarter, his hedge fund held on to most of its holdings in the Chinese companies it scooped up earlier this year, even as it trimmed stakes in Alibaba Group Holding and US tech giants. Now, after China’s top leaders ramped up efforts to revive growth with pledges to support fiscal spending and stabilise the property sector, Tepper is once again snapping up Chinese stocks, including Alibaba and Baidu.

“We got a little bit longer, more Chinese stocks,” he said, citing low valuations, even after this week’s price surge.

Rubner, tactical specialist and managing director for global markets at Goldman, believes the long-awaited recovery in Chinese equities may finally have arrived, and, if so, investors should want to get in on it.