Are ATM still 'uninvestable'?

Do they know something we don’t?
Fallen angels such as Alibaba Group, Tencent Holdings and Meituan (collectively referred to as ATM) – with the first one causing 98 year-old Charlie Munger a reported 40 per cent loss in the last six months- seemed to be seeing the light at the end of the tunnel.
Hang Seng Technology Index had a gain of 5.8 percent yesterday –led by a sharp rebound in the three mighty internet giants after a couple of brokers upgraded the battered sector.
Specifically JP Morgan made a sharp u-turn by raising the stocks of the big seven mainland tech firms to “overweight” from “underweight” after its famous call in March that labeled these stocks as “uninvestable” in the next six to 12 months.
In a note published Monday, JP Morgan China Internet analyst Alex Yao said significant uncertainties should begin to abate on the back of recent regulatory announcements that came earlier than expected.
“We think key risks to the sector have diminished, particularly in terms of regulatory risk, ADR delisting risk, and geopolitical risk,” Yao said.
Also joining the chorus was HSBC, which upgraded the internet sector with a bold call that the sector would restart the rally.
With the benefits of hindsight, the big call from JP Morgan turned out to be less than a thunder. Alibaba, for example, went down 10 per cent after the call on 14 March but rebounded 30 per cent the following day. The shares went up a month after the call but it was down in the last 10 days before yesterday when it closed pretty much the same before the call was made.
Still, the Hang Seng Tech index which tracks the largest Hong Kong-listed technology stocks has fallen more than 27 per cent this year, as of Monday’s close before the Tuesday rally.
As expected, the unwelcome call caused JP Morgan certain embarrassment in China. It was reported that the “uninvestable” term appeared in 28 reports but later amended as “unattractive” in 24 reports. The US investment bank later explained that it was meant to be an internal call.
What has changed? Market has been expecting some good news coming out from the National Committee of the Chinese People's Political Consultative Conference in hopes that the new economy could fuel the depressing Chinese economy after an almost two-month lockdown in Shanghai
HSBC noted the equity risk premium of Chinese-related stocks rose to 6.37 per cent based on CSI 300 Index, or near the 2019 level. A lower US import tax on China goods and a weak renminbi could boost corporate earning, which are positive to mainland stock markets.
Market goes up and down regardless of what experts say. What I am more certain is the law of physics would apply to stock markets: what goes down would go up and vice versa.
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