Jim Cramer, the outspoken financial commentator, has thrown his hat into the ring of speculation surrounding China’s proposed stock stabilization fund. In a tweet, Cramer expressed his amusement at the prospect of the Chinese government intervening in the market, asking, “Who gets that call?” and wondering if the fund might invest in tech giants like Baidu and JD.com.
China’s plan to inject at least 800 billion yuan ($113 billion) into its equity markets is a significant move aimed at bolstering its struggling economy. The proposed stabilization fund is expected to provide much-needed support for Chinese stocks, generating excitement among investors.
Baidu and JD.com have emerged as potential beneficiaries of this intervention, given their recent performance and the potential tailwinds from government support.
Baidu’s stock has shown resilience, trading above its key moving averages. Analysts project a 12-month price target ranging from $105 to $139, with an average of $122. However, the stock is facing selling pressure, raising concerns about short-term volatility.
JD.com’s stock is also exhibiting bullish trends, trading above all key moving averages. Analysts estimate a 12-month price target between $28.00 and $47.00, averaging $37.50. Similar to Baidu, JD.com is experiencing selling pressure, which could impact its future performance.
While Cramer’s commentary adds a layer of intrigue, investors are urged to exercise caution and consider the inherent risks of investing in Chinese equities. The stabilization fund may provide a lifeline, but careful evaluation of both stocks’ fundamentals and market conditions is crucial before making investment decisions. The ongoing economic uncertainty necessitates a thorough assessment of the potential benefits and risks involved.
