Breakfast | US stock indices closed lower while Chinese concept stocks surged against the trend, as American retail investors "big brother" increased their holdings in Alibaba

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Three major stock indices all fell, Alibaba rose over 8%, Bilibili rose nearly 9%

The U.S. stock market closed lower on Thursday, with most sectors ending in decline. The Dow Jones fell 1%, the S&P 500 index fell 0.4%, and the Nasdaq fell 0.47%. Market sentiment was hit by the ongoing tension in U.S.-Ukraine relations and Walmart's weak earnings guidance.

Although Walmart's fourth-quarter performance exceeded expectations, its earnings outlook for fiscal year 2026 fell short of analysts' expectations, and it expects sales growth for the current fiscal year to be only 3% to 4%. Walmart fell over 6%. Affected by Walmart's news, retail stocks such as Target and Costco also fell about 2%.

The "Tech Seven Sisters" had mixed results. NVIDIA rose 0.63%, Microsoft rose 0.53%, Apple rose 0.39%, Google A fell 0.38%, Meta fell 1.27%, Amazon fell 1.65%, and Tesla fell 1.71%. Palantir, favored by retail investors, saw its stock price drop 5.2%, with a cumulative decline of over 10% this week.

AI concept stocks generally fell. Advanced Micro Devices fell 1.63%, Dell Technologies fell 0.88%. Oracle fell 3.04%, SoundHound AI, in which NVIDIA holds shares, fell 1.45%, AppLovin fell 8.94%, and Bigbear.ai fell 4.57%.

Chinese concept stocks had mixed results. The FTSE China 3x Long ETF (YINN) rose 5.99%, and the "China Dragon" Roundhill China Dragons ETF (DRAG) rose 2.76%. Tuya Smart rose 26.8%, GDS Holdings rose 12.76%, Century Internet rose 12.58%, Bilibili rose 8.76%, Alibaba rose 8.09%, JD.com rose 5.1%, Kingsoft Cloud rose over 4.3%, Noah Holdings rose about 3.8%, Baidu, Boss Zhipin, and Beike rose at most over 1.8%, New Oriental, Daqo New Energy, Autohome, and Zai Ding Medical rose at most over 0.4%, Li Auto and Nio fell over 0.8%, XPeng fell over 1.7%, Tencent Holdings rose 3.05%, Pinduoduo fell 0.02%, Fangduoduo fell 3.11%, and Wenyan Zhixing fell 18.88%.

Media: GameStop CEO increases Alibaba stake to $1 billion

According to The Wall Street Journal, GameStop (GME.N) CEO Ryan Cohen has increased his stake in Alibaba to approximately 7 million shares. He privately urged Alibaba in 2023 to accelerate its stock buyback plan, stating that Alibaba's stock is severely undervalued. He had also privately discussed hopes of establishing a long-term partnership with Alibaba. He recently had further discussions with Alibaba.

Surge in bullish options for Alibaba and Chinese stock ETFs

After Alibaba disclosed quarterly revenue that exceeded expectations, options trading volume surged to its highest level since December 2020. So far, 1.25 million contracts have been traded, while the 20-day average is about 509,000 contracts. Bullish options for iShares China Large-Cap ETF (FXI) were actively traded, and KraneShares CSI China Internet ETF (KWEB) options trading volume increased again

Salesforce Denies $1 Billion AI Cloud Deal

Salesforce CEO Marc Benioff stated that reports suggesting Salesforce is negotiating a cloud computing deal worth over $1 billion with major tech companies Microsoft, Google, and Oracle are incorrect. While Salesforce is exploring a fourth cloud option in 2024, in addition to its current choices of Amazon's AWS, Alibaba, and its own data centers, it will choose to expand its partnership with Google.

Goldman Sachs Managing Director Expects US Stocks to Correct, Fund Inflows to Weaken

Goldman Sachs' Scott Rubner indicated that as retail and institutional buyers lose momentum, the US stock market may enter a correction phase. "The flow of funds began to change dramatically on Monday," and the demand from retail investors, which surged at a record pace into US stocks this year, is expected to slow down before the March tax season. Fund flows from pension funds may also "lose momentum," which Rubner attributes to seasonal trends. January and February are typically the strongest months for annual asset allocation, and by March, inflows are expected to weaken.

Trump's Aluminum Tariffs to Impact 123 Products Including Chip Equipment

According to Nikkei News, the additional aluminum tariffs set to take effect on March 12 in the US will cover 123 products, including components for chip manufacturing equipment and aircraft parts, which could be a blow to Japanese companies reliant on exports to the US. On February 10, Trump signed an executive order imposing an additional 25% tariff on imported steel and aluminum products.

Meta's Stock Price Surge May Trigger Calls for a Stock Split

Meta has recently seen a record 20-day consecutive rise, pushing its stock price to a closing record, with an increase of over 20% this year, making it the best performer among the "Seven Giants" in 2025. Investors may begin to call for the company to split its stock for the first time since its IPO in 2013. Meta is the only major tech stock that has never split its shares. According to Bank of America analysis, the average return one year after a stock split can reach 25%, while the market's return is only 12%.

Mixue Ice Cream IPO Plans to Issue 17.05 Million Shares at HKD 202.5

Mixue Ice Cream announced on the Hong Kong Stock Exchange that it plans to issue 17,059,900 H shares (subject to the exercise of the over-allotment option) for its initial public offering in Hong Kong, with the offer price set at HKD 202.50 per share unless otherwise announced. The stock code is 2097, and it is expected to officially list on March 3.

Chen Rui: DeepSeek Provides Bilibili with Strong Conditions to Explore Quality Content Value

At the Q4 earnings conference, Bilibili Chairman and CEO Chen Rui stated that with the emergence of inexpensive and open-source large models like DeepSeek, Bilibili has very strong conditions to explore the value of these quality contents. In the past few months, Bilibili has conducted some small internal experiments, and the results have been very surprising. Moving forward, I may report some of our achievements in artificial intelligence applications to everyone each quarterBilibili's Q4 revenue reached 7.734 billion yuan, a year-on-year increase of 26%; adjusted net profit was 452 million yuan, achieving a comprehensive profit turnaround.

Alibaba's Eddie Wu: Our new investment direction for the next three years will focus on AI strategy

Alibaba CEO Eddie Wu stated that the new investment direction for the next three years will focus on AI strategy, with increased investment in the following three major areas: 1) Infrastructure construction for AI and cloud computing, with the group's investment in cloud and AI infrastructure expected to exceed the total of the past decade over the next three years. 2) AI foundational model platforms and AI-native applications. 3) AI transformation and upgrading of existing businesses.

Alibaba: There are currently no plans to sell Hema

Hema has shown good growth, robust expansion, and achieved solid overall profitability, representing a successful digital new retail strategy that integrates offline and online. Alibaba will adopt a more open mindset, including introducing strategic investors, to reflect the value of the Hema business in Alibaba Group's overall valuation.

Alibaba's financial report: Revenue increased by 8% year-on-year, net profit rose by 333%, and revenue from AI-related products has achieved triple-digit growth for six consecutive quarters. Capital expenditures surged, with executives stating that investments in cloud and AI infrastructure over the next three years will exceed the total of the past ten years. Alibaba's U.S. stock rose 8% on Thursday.

Trump expresses anticipation for Chinese leaders to visit the U.S., stating that the U.S. may reach a new trade agreement with China.

China's Finance Minister Lan Fo'an: Fully grasp the connotation and requirements of a more proactive fiscal policy

To effectively implement a more proactive fiscal policy, continuous efforts must be made, and a "combination punch" of policies should be utilized to transform various positive factors into tangible development results. First, increase the fiscal deficit ratio, enhance expenditure intensity, and accelerate expenditure progress. Second, arrange for a larger scale of government bonds to provide more support for stabilizing growth and adjusting structure. Third, vigorously optimize the expenditure structure, strengthen precise allocation, and pay more attention to benefiting people's livelihoods, promoting consumption, and increasing momentum. Fourth, continue to prevent and resolve risks in key areas to promote stable fiscal operations and sustainable development. Fifth, further increase transfer payments to local governments to enhance local financial capacity and ensure the bottom line of the "three guarantees."