On Monday, internet search engine giant Google said it will provide a $550 million cash investment into JD.com, China’s second-largest e-commerce company. As part of the deal, Google will receive over 27 million newly-issued JD.com Class A ordinary shares at a $20.29 per share price point.
Google will work in conjunction with JD.com to develop a retail infrastructure that can enhance and personalize the online shopping experience, as well as reduce friction in various markets like Southeast Asia. In addition, JD.com said plans are underway to make a selection of items available for sale in places like the U.S. and Europe through Google Shopping, which allows users to search for products online and compare prices between different sellers to locate the best price.
The Google-JD.com partnership would allow JD.com to grab more market share by offering products to consumers located outside China. This news comes at a time when trade tensions between the United States and China are bubbling, which according to JD.com CEO Richard Liu, could hamper the sales of American retailers.
“If it’s a long-term (trade) war, it will be horrible,” Liu told CNBC.
Nonetheless, a Google-JD.com partnership could open up opportunities for investors looking to capitalize on the Chinese technology sector. Below are three China technology ETFs that could be poised for a gain should other U.S.-China technology companies decide to work in concert with one another despite the trade tensions:
- KraneShares CSI China Internet ETF (NYSEArca: KWEB): up 5.02% year-to-date, up 29.97% in the past year and up 15.14% the last three years
- Invesco China Technology ETF (NYSEArca: CQQQ): down 2.41% year-to-date, up 33.72% in the past year and up 13.33% the last three years
- Global X NASDAQ China Technology ETF (NYSEArca: QQQC): down 1.62% year-to-date, up 23.6% in the past year and up 4.92% the last three years
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