Though the relationship between the world’s top two economies, the United States and China, has remained rocky over the past several years, a planned virtual summit by the two nations by the end of this year might ease tensions to an extent. We believe that the Chinese stocks NetEase, Inc., (NASDAQ:), and Weibo Corporation, (NASDAQ::) will continue to rise in value over the next few months. Let’s discuss.
A virtual summit between U.S. President Joe Biden (China President Xi Jinping) is planned to take place prior the end of the year. The goal of the summit would be to address the issues central in U.S./China rivalry. Scott Kennedy of the Center for Strategic and International Studies believes that although this summit indicates only a “limited thaw” in the bilateral relationship, it could help stabilize U.S.-China competition and help avoid misunderstandings.

The news about the scheduled virtual summit between China and the United States, as well as relief at the U.S. policymakers’ decision to end a Congressional standoff over the debt ceiling in an effort to prevent a default, drove Chinese technology stock prices up last week. UBS Global Wealth Management chief investment officer Mark Haefele stated that both parties could have investment opportunities in areas such as capital markets and technology. This is even with a limited improvement in their relationship. Investors may be able to make a bet on Chinese stocks at this time.

We believe that Chinese stocks NetEase, Inc. and Weibo Corporation could be great bets because they have solid returns on better U.S. China relations.

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