Investing.com — Shares of Alibaba Group (HK:) (NYSE:) Hong Kong rose to a seven-month high on Friday after Michael Burry’s investment firm increased its stake in the e-commerce giant and several of its Chinese peers.
Alibaba.com rose more than 7% to HK$85.80, the highest level since October 2023. The stock was the best performer on the index, which rose 0.9%.
Burry’s Scion Asset Management increased its stakes in Alibaba and JD.com (HK:) (NASDAQ:), with the latter becoming its largest holding in the first quarter, a 13-F filing showed earlier this week. Scion increased its stake in JD by 80%.
Alibaba was the fund’s second-largest holding, with Scion increasing its position in the e-commerce giant by 50,000 shares to 125,000 shares, worth about $9 million.
Burry, who famously predicted and shorted the 2008 U.S. housing crisis, has been buying heavily priced Chinese tech stocks over the past year on expectations that the sector will rebound due to a broader post-COVID recovery in China economy.
While Chinese stocks tumbled in 2023, Burry’s bet now appears to be paying off so far in 2024. Alibaba is up 14% so far in 2024, while JD.com is up 21% so far in 2024 .
The gains came even after Alibaba disappointed with its first-quarter earnings. However, JD beat expectations with its first-quarter earnings on Thursday.
Still, the broader Chinese stock market has staged a strong recovery over the past two months as global investors slowly warmed up to local stocks amid continued government support.
China also saw a regulatory crusade against its internet giants wind down over the past year, as Beijing looked at all options to boost growth.
