China's economy, Alibaba, Boeing at Congress: What to Watch

The People's Bank of China has cut reserve requirements for banks as Chinese officials seek to boost its economy and markets. Alibaba (BABA) Co-Founders Jack Ma and Joe Tsai reportedly acquire up to $200 million in shares.

Yahoo Finance Live co-hosts Akiko Fujita and Rachelle Akuffo break down these headlines coming out China, while also taking a look at Boeing (BA) CEO David Calhoun's meeting with US lawmakers this week to address safety and manufacturing concerns.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Luke Carberry Mogan.

Video transcript

AKIKO FUJITA: Chinese authorities looking to inject additional stimulus into the world's second largest economy. The PBOC, China's central bank, announcing a cut to the reserve requirement ratio, reducing the amount of cash banks are required to hold in reserve. This in a week where we saw China's benchmark CSI 300 index hit a five-year low.

And Rachelle, we've been talking about this for some time about what additional stimulus measures are likely to come out of China at a time when we have seen a significant slowdown in the economy. The size of this triple cut, certainly something to note-- 50 basis points, as opposed to the 25 basis points we've been seeing over the last few years.

And of course, we've been watching this in the context of the markets as well. A real lack of confidence, if you will, in Chinese investors in their home market. We talked about the CSI 300 hitting a five-year low.

These Bloomberg reports coming out this week as well that Chinese authorities are looking to shore up roughly $280 billion in offshore money as a part of a stabilization fund, essentially creating a floor in a time where we have seen roughly $6 trillion wiped out from Chinese equities since the peak we saw in 2021.

RACHELLE AKUFFO: It's true. I think this was clearly a confidence boost that was needed. But you have to wonder if it's enough. Usually, you sort of see China make these very big moves, especially as we were expecting a real rebalancing after they came out of their zero COVID policy that didn't materialize.

And then when you think of a lot of the companies that have the biggest exposure to China's market, of course, you're thinking your Apples and your Tesla-- we keep hearing that those markets, kind of being some of these make or break issues when it comes to some of the consumer demand that they're seeing as well.

It is interesting to note, though, the Chinese stock market-- somewhat different when you think of the US stock market because it is a lot of retail investors. And one of the things that drives retail investors is how they're feeling about their personal economy. And as we've seen with the property sector, that's also been playing into some of that uncertainty to really want to continue to play in the Chinese market, Akiko.

AKIKO FUJITA: Yeah, it's been part stimulus, part messaging, right, from Chinese authorities saying-- trying to inject confidence back into the market. To that point, we did see Alibaba co-founders, Joe Tsai and Jack Ma, buy up roughly $200 million in Alibaba shares this week.

You could argue, on the one hand, that's a move to inject confidence. On the other hand, it is a sign of confidence if the co-founders are willing to buy up these shares in this amount, maybe the outlook isn't as bad as it seems. I mean, certainly, going to be a lot of questions there. But interesting developments coming out of China as we continue to track that economy.

RACHELLE AKUFFO: Indeed. And speaking, of course, of developments, also looking at Boeing CEO Dave Calhoun in the hot seat on Capitol Hill today in the wake of the Alaska Airlines mid-air blowout of its 737 Max 9 door plug, and of course, the subsequent fallout and some of the other issues that we've seen.

Now, of course, this is happening in a week full of airlines earnings and, of course, frustration over the response from Boeing so far. Now something that's really adding some salt in the wound here is someone who cited that they were familiar with the work. Speaking to the "Seattle Times" saying that the fuselage panel that was removed and then repaired improperly by Boeing mechanics in the rental final assembly line.

Now this would-- obviously, this would be an issue considering the blame here, because the original installer was Spirit AeroSystems, not to be confused with Spirit Airlines. But this is something that hasn't been confirmed by Boeing. We've reached out for comment as well as by the NTSB. But it does really speak to this issue of the oversight of this, and really some of the ongoing problems that it's been having.

Now it is going to be having the first of what it's called a "Quality Stand Downs" for the 737 model. Now that's going to take place in Renton, Washington tomorrow according to their commercial airplanes CEO Stan Deal. And worth noting, United has more Max 9s than any other airline. So we're seeing that frustration come out too.

AKIKO FUJITA: Well, I mean, quality control, the big question for Boeing, and that "Stand Down" you mentioned-- I mean, you have to wonder, is that enough to re-instill confidence that Boeing has a handle on this situation? You mentioned United-- we're getting a better sense of the fallout from this particular issue with the Max 9s.

United, yesterday, saying they expect to post a first quarter loss as a result. Also, CEO Scott Kirby there talking about a delay that he's expecting now with the Max 10s. Now if you'll recall, when that initial order was put in for 277 jets there, that was expected to be delivered in 2020.

So it's not just about the delays, it's about the quality, these issues that continue to pop up. And the biggest customers for Boeing, saying, look, we have serious questions about whether, in fact, they can deliver, and whether these planes are going to be safe.

RACHELLE AKUFFO: It's true. And obviously, we'll see what we'll actually hear from them when they face lawmakers today. But obviously, that frustration trickling in and hitting some of those earnings reports there.

AKIKO FUJITA: Yeah, Alaska Airlines also reporting on Thursday. So we'll be watching that one closely.