The news added to a more upbeat tone around Chinese assets, where the prospect of a sizable rebound is too good to pass up for many investors. Policy makers in Beijing appear to be delivering on pledges made in March to support the economy, prevent a downward spiral in the housing market and wrap up a crushing crackdown on tech companies. The offshore yuan added 0.2% by 9:45 p.m. in Hong Kong and was headed for its highest closing level in five weeks.

“I think we are bumping along the bottom here,” Chi Lo, senior Asia Pacific investment strategist at BNP Paribas Asset Management, said in a Bloomberg Television interview before the Wall Street Journal report. “When you look at the biggest drag on Chinese equities — which was the regulatory tightening on the tech sector — the worst is over.”

Authorities are taking more conspicuous steps to shore up growth. In the past week alone, Shanghai’s government freed the majority of its residents from a Covid Zero lockdown, while China’s finance ministry and central bank said they would press ahead with policies to offset damage to the economy. A state-owned entity stepped in to rescue a private property developer, triggering a record rally in its bonds and signaling that government support could help pull the industry from its most severe downturn in years.

The moves appear to be having the intended effect. The CSI 300 Index of onshore stocks is up 10% since a two-year low in late April, outperforming almost every national benchmark tracked by Bloomberg. Foreign outflows turned to inflows last week for the first time since March, while falling short interest shows speculators are unwinding their most bearish bets.

There are multiple threats to the stock rebound. China’s Covid Zero strategy means strict containment could continue to disrupt manufacturing, shipping and consumption. Hopes that Beijing was nearing the end of a crackdown on the tech industry have been dashed many times before. Even if China ramps up stimulus, it’s unclear whether it will work, with banks struggling to lend and consumers unwilling to spend.

But while a bullish case on China based on value alone keeps failing, it’s becoming harder to say that the more optimistic views aren’t finally playing out. Even Morgan Stanley’s strategists — among the only team on Wall Street to recommend staying clear of Chinese assets for the past year — said sentiment is improving onshore.

To Du Kejun, a partner at Beijing Gelei Asset Management Center Ltd., allowing Didi to grow its user base again would mark the start of a sustained recovery in Chinese stocks.

“This is likely to be the inflection point — this action speaks louder than words,” said Du.