TV chat shows in China last week noted the rise in Apple’s equity value to $2tn, thanks in part to massive injections of liquidity from the US Federal Reserve. Participants debated whether such heights were sustainable.
It may have been more worthwhile to discuss how much further the valuations of China’s own tech giants — led by New York-listed Alibaba, up 25 per cent this year to a market capitalisation of almost $720bn — can continue to rise.
The challenges these companies face are not so much about their ability to execute on their strategies, but the extent to which they are victims of politics. Outside China, the likes of Tencent and Alibaba are increasingly constrained by rising tensions between governments. But it is within China, perhaps, that the greatest tests lie.