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Trump Tariffs Impact: 2 Chinese Stocks to Buy, 2 to Avoid
Trump tariffs are back on the table! Discover 2 Chinese stocks to buy for their resilience and 2 to avoid as market fears shake the e-commerce giants.
Daisy Pearl
November 27, 2024
In partnership with
Buy or Bye-Bye? The Tariff Tango Begins Again
Donald Trump has hinted at imposing tariffs as high as 100% on Chinese goods.
Is it tough talk or a negotiation ploy?
Who knows?
But investors aren’t waiting to find out.
Chinese stocks are already feeling the heat.
Still, not every Chinese business is in the danger zone.
Some might even thrive.
So, let’s dive into two stocks worth buying on the dip—and two better left alone.
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Skip: Alibaba (NYSE: BABA) – E-Commerce Giant or Ticking Time Bomb?
Alibaba’s rollercoaster ride isn’t for the faint-hearted.
Fueled by China’s stimulus hype, its stock soared 38% from $85 to $117 in September.
But by late November, it plummeted back to $83.
Ouch.
BABA’s Stock Chart from StockCharts
Why Alibaba Is Risky Right Now
Most of Alibaba’s revenue comes from China.
Only a sliver—less than 1%—of its earnings stem from U.S. sales.
Still, even a whiff of a 100% U.S. tariff is enough to spook investors.
It’s all about sentiment, and fear can drive prices lower.
If Alibaba hits rock-bottom prices, it might tempt some bargain hunters.
But for now, it’s on the “avoid” list.
Skip: PDD Holdings (NASDAQ: PDD) – Temu’s Tempting Growth Comes at a Cost
PDD’s international play, Temu.com, has exploded in the U.S. market.
Its ridiculously low prices, influencer campaigns, and gamified shopping make it irresistible.
But there’s a catch.
PDD’s Stock Chart from StockCharts
The Risks Are Piling Up
Nearly 6% of PDD’s total revenue comes from U.S. sales.
And with potential tariffs looming, Temu could take a serious hit.
Add in regulatory concerns (national security, anyone?), and this stock has “too risky” written all over it.
Buy: JD.com (NASDAQ: JD) – Staying Close to Home Pays Off
JD.com has earned its title as the "Amazon of China."
Unlike Alibaba, it sticks to its home turf, avoiding tariff troubles altogether.
JD’s Stock Chart from StockCharts
Why JD.com Is a Safer Bet
Its e-commerce operations are laser-focused on Chinese customers.
No English site.
No major U.S. revenue.
This local approach has paid off, with JD shares up 20% year-to-date.
For investors looking to dodge tariff drama, JD.com looks solid.
Buy: Li Auto (NASDAQ: LI) – Driving Success Beyond Tariff Troubles
Li Auto is winning in China’s EV market with its unique Extended-Range Electric Vehicles (EREVs).
LI’s Stock Chart from StockCharts
These cars go the extra mile—literally—by using a motor to recharge their batteries, offering up to 877 miles of driving range.
Why Li Auto Isn’t Sweating U.S. Tariffs
Li Auto doesn’t sell in the U.S. at all, thanks to existing 100% tariffs on Chinese cars.
Instead, it’s expanding into Europe, where tariffs aren’t an issue.
With over a million vehicles delivered and growing profitability, this stock looks like a winner.
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Wrapping It Up: Your Next Move
Trump’s tariff talk might shake up the market, but it doesn’t mean all Chinese stocks are doomed.
Skip Alibaba and PDD Holdings for now.
What’s Your Take?
Do you see opportunity or risk in these stocks?
Which ones are you watching—or avoiding—right now?
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