Important points
Billionaire David Tepper said in an interview with CNBC Thursday that following China’s massive economic stimulus package announced Tuesday, it’s time to invest in the country. The Appaloosa Management founder said he plans to buy “everything” in China. “ETFs, I’d do futures.” Tepper, who also owns the Carolina Panthers, said many Chinese companies are attractive because they have low price-to-earnings ratios and good growth prospects.
Billionaire hedge fund manager David Tepper has made an ambitious call for greater engagement with China.
The Appaloosa Management founder said in an interview with CNBC on Thursday that now is the time to build on China’s massive economic stimulus package announced on Tuesday. “This has implications for bonds, currencies and stocks,” Tepper said.
After the Chinese government’s stimulus announcement, Mr. Tepper said he planned to invest in “ETFs, futures, whatever.”
Earlier this year, Tepper doubled his stake in e-commerce giant Alibaba Group (BABA), Chinese ISP Baidu (BIDU), online agricultural retailer PDD Holdings (PDD), and is also the owner of the Carolina Panthers.
The prominent investor said he likes many of China’s largest companies because they have “single-digit (price-to-earnings) multiples with double-digit growth rates.” Tepper added that the Chinese government’s willingness to allow stock buybacks is also appealing.
Tepper said he made similar remarks in 2010. This period followed strong growth in Chinese stocks before the Chinese government’s crackdown on tech giants and a slowing Chinese economy began a downward spiral.
Bank of America expects to take financial action in coming weeks
Still, most economists and analysts were disappointed with Tuesday’s package of measures, saying large fiscal stimulus, not monetary policy, was needed to boost the country’s weak domestic demand levels.
Analysts at Bank of America said in a note Wednesday that China expects to unveil fiscal policy in the coming weeks, including “stimulus measures to stimulate consumption and investment demand, and further strengthening of social security, health care, and pro-fertility measures.” He said he expected that. . ”
