Chinese data security stocks surge due to CrowdStrike's update failure, but market experts see sustainability issues

From Yahoo Finance: 2024-07-21 23:53:00

Chinese data security companies saw a surge in stocks due to speculation after a software update by CrowdStrike failed, potentially increasing demand for domestic options. Shenzhen GuoHua Network Security Technology Co. and Hunan Kylinsec Technology Co. jumped, while 360 Security Technology Inc. climbed. Despite this, major onshore benchmarks fell post-Third Plenum disappointment.

The global IT meltdown from a flawed software update last week led to gains in Chinese data firms, though sustainability may be an issue due to inferior technology compared to global competitors. Market experts view the rally as speculative trading without significant catalysts driving growth, despite policy support for domestic companies in the data security sector.

The CSI 300 Index took a hit Monday even after the People’s Bank of China cut a key short-term policy rate for the first time in nearly a year and lenders reduced benchmark lending rates. The conclusion of the Third Plenum lacked bullish momentum for stock traders, indicating the market may be stagnant in the near future.



Read more at Yahoo Finance: Chinese Data Security Stocks Rally After Crowdstrike’s Botched Update