David Tepper Sells Nvidia, Bets Big on China's Stimulus-Boosted Market

David Tepper, the billionaire investor and founder of Appaloosa Management, has made significant moves in his investment portfolio, recently opting to sell a large portion of his Nvidia holdings. Tepper expressed doubts about Nvidia's growth potential, highlighting concerns over whether their next-generation models could maintain the company's market position. Despite Nvidia's market cap hovering around $3 trillion, it remains 12% below its June peak, with Tepper stating that other stocks inspire more confidence.

In contrast, Tepper is shifting his focus towards Chinese stocks, encouraged by China's surprising large-scale stimulus measures. He attributes this pivot to the robust fiscal policies recently introduced by Chinese authorities aimed at supporting economic growth, stabilizing the real estate sector, and enhancing financial expenditure.

During the second quarter, Tepper's hedge fund maintained significant holdings in Chinese companies acquired earlier in the year, even as it reduced stakes in major U.S. tech firms like Alibaba and Baidu. As China renews its commitment to economic stimulus, Tepper has increased his investments in these Chinese tech giants, citing undervaluation as a primary reason, despite recent stock price surges.

Tepper remains optimistic about the potential of Chinese stocks, indicating a willingness to hold them for longer durations and larger quantities. He expressed that, even after the recent price hikes, the valuations are still appealing, affirming his confidence in continued market opportunities.

While acknowledging potential geopolitical challenges and tariff impacts, Tepper is less concerned, viewing China's internal fiscal initiatives as powerful stimulants for consumer spending, which he believes will drive further growth in the market.