Billionaire hedge fund founder David Tepper said his big bet after the Federal Reserve’s rate cut was to buy Chinese stocks. “I thought that what the Fed did last week would lead to China easing, and I didn’t know that they were going to bring out the big guns like they did,” Tepper told CNBC’s “Squawk Box” on Thursday. “And I think there’s a whole shift.” “We got a little bit longer, more Chinese stocks,” Tepper continued. “And so, I have limits, historic limits. I probably said a long time ago, I don’t go above 10% or 15%. Well, that’s probably not true anymore.” In fact, the founder of Appaloosa Management said he may have doubled his limit to China equities, saying he bought more of “everything” such as large-cap tech giants Alibaba and Baidu after the U.S. lowered interest rates earlier this month. “It’s everything. Now, I would love to see a pullback, OK,” he said. “I will have another newfound limit, OK, in a pullback.” Tepper has grown optimistic on the China market this month after state media on Thursday afternoon said Chinese President Xi Jinping and other top leaders affirmed the government’s efforts to stimulate the economy. That comes after China earlier this week unveiled interest rate cuts , as well as other measures to support the property market. “They promised to do more and more and more. OK? And that’s very strange language, especially for, you know, any central banker, but especially over there,” Tepper said. “And last night, you know, we heard that they were going to have some kind of meeting, but they kind of blew away expectations on the fiscal stimulus.” FXI 1D mountain iShares China Large-Cap ETF The iShares China Large-Cap ETF (FXI) rallied more than 6% following Tepper’s comments, extending its gains from a winning session for Chinese and Hong Kong stocks. Tepper also noted the Chinese market is cheaper than U.S. equities. “You’re sitting there with single multiple P/Es with double-digit growth rates for the big stocks that trade over here,” Tepper said. “That’s kind of versus what, you know, the 20-plus on the S & P.” As part of a China play, Tepper said that he would buy Wynn Resorts and Las Vegas Sands . The casino stocks popped 7% and nearly 6%, respectively. To be sure, rising geopolitical concerns including further tariffs between the U.S. and China have spooked many investors away from the China market. However, Tepper dismissed those risks. “My counter bet is that I don’t care,” he said.
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