Michael Burry reduced China tech holdings prior to DeepSeek-fueled rally

Published 17/02/2025, 06:58
© Reuters

Investing.com-- Renowned investor Michael Burry, known for his prescient bet against the U.S. housing market in 2008, reduced his positions in Chinese technology stocks shortly before a significant market surge driven by DeepSeek's AI breakthrough, 13F regulatory filings showed on Friday.

Burry's Scion Asset Management had allocated approximately half of its portfolio to Chinese tech giants, including Alibaba (NYSE:BABA) Group Holding Ltd (HK:9988), Baidu (NASDAQ:BIDU) Inc (HK:9888), and JD (NASDAQ:JD).com (HK:9618), as of mid-2024.

However, recent filings indicate that Burry trimmed these holdings in the fourth quarter, preceding a rally sparked by DeepSeek's AI breakthroughs.

Michael Burry’s investment firm, Scion Asset Management, reduced its stake in JD.com by 40% in the fourth quarter, while its investment in Alibaba dropped by 25% during the same period.

The Hang Seng Index has climbed nearly 11% so far this month, as investors responded to China's AI advancements and supportive government policies.

Notably, Tencent Holdings Ltd (HK:0700) shares surged on Monday, after announcing beta testing of its Weixin app with DeepSeek integration.

Burry's cautious approach reflected concerns over headwinds from escalating U.S.-China tensions and weak domestic economic growth, affecting Chinese tech firms.

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