Is it a signal for Chinese concept stocks to hit bottom? Internet giants are aggressively repurchasing stocks.

During the downturn in the stock market, the two giants of the Internet industry, Alibaba and Tencent, sent a signal of the market bottom by repurchasing a large number of shares. In 2023, Alibaba used $9.5 billion to repurchase shares, while Tencent's repurchase actions were even more frequent, with a total repurchase amount of nearly HKD 50 billion and over 120 times throughout the year.

Share repurchase is one of the common means of market value management for listed companies, especially when stock prices are undervalued, it can effectively boost investor confidence. Behind the repurchase actions, the confidence of the company's management is evident. Through repurchases, companies can reduce the number of shares in circulation, thereby increasing earnings per share and conveying positive messages to the market.

Alibaba stated that by the end of 2023, the company's outstanding shares had decreased by 3.3% and still retained a repurchase budget of $11.7 billion. This behavior not only demonstrates recognition of its own value but also shows optimism about the future market trend. Since 2020, Alibaba's repurchase budget has increased from $10 billion to the current $40 billion, which is a clear signal of confidence in the company's long-term development strategy.

Tencent's actions also demonstrate confidence. On January 3, 2024, Tencent repurchased 3.36 million shares on the open market, investing HKD 1.002 billion. This move was based on the full-year repurchase in 2023 and the total repurchased shares accounted for 1.47928% of the issued shares, clearly expressing a firm belief in the company's future development.

These two companies are not only the leaders in the Chinese Internet industry but also the focus of global investors. Their repurchase actions have benchmark significance, not only positively impacting their own stock prices but also potentially having a positive effect on the overall market sentiment of the industry. In the Hong Kong stock market, more than 200 companies have implemented repurchases, which is a positive signal for overall market confidence.

However, the market also remains concerned about the challenges faced by these Internet giants, such as Alibaba's significant decline from its market value peak and the impact of regulatory and market environment changes. Nevertheless, in the context of market uncertainty, this repurchase behavior undoubtedly conveys a positive attitude to investors.

Overall, the repurchase actions of Alibaba and Tencent are not only an affirmation of their own value but also an investment in the future market. This action not only helps stabilize stock prices but may also become a catalyst for market recovery. With the proactive measures taken by these Internet giants, market expectations for their future are more optimistic, and it is expected to contribute to the recovery and growth of their businesses in the post-pandemic era.