Chinese ADRs dropped in premarket trading Wednesday as investors mulled the sustainability of China’s rally.

YINN fell 12%; Alibaba, PDD Holdings, and Baidu fell 4%; JD.com, NIO, and Li Auto fell 5%; XPeng and Bilibili fell 6%.

Chinese stocks rose as traders continued to bet Beijing’s wide-ranging stimulus package would help drive a market turnaround and kickstart the country’s sluggish economy. The offshore yuan strengthened past 7 for the first time since May 2023 while the dollar hit an eight-month low.

Investors are cautiously optimistic that the policy barrage has put a floor under China’s stock slump, with expectations that more fiscal support will follow. A slowdown in the world’s second-largest economy had been a major overhang for Asian stocks and a meaningful recovery as a result of the policy support may help drive gains across the region.

The stimulus that helped the regional stock gauge soar to the highest level since February 2022 was the latest positive news for equities and currency markets, already benefiting from the Federal Reserve’s outsized rate cut last week. Emerging Asian currencies also jumped, led by the Malaysian ringgit and Thai baht.

“China’s latest package of easing measures to support the property and stock markets is a positive move,” wrote Morgan Stanley economists including Chetan Ahya, in a note Tuesday. “However, we think investors won’t see the measures as sufficient to address deflation. The measures will not be effective in boosting much-needed consumption.”

In a further filip to shares, China’s central bank on Wednesday lowered the interest rate charged on its one-year policy loans by the most on record.

Support measures unveiled by Chinese authorities Tuesday included interest rate cuts, more cash for banks, bigger incentives to buy homes and plans to consider a stock stabilization fund.

“The liquidity boost expected from China may have some positive spill-over via commodities and the supply chain, so EM equities and currencies are likely to be boosted,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore. “The optimism may be raising the bar on follow-through details and measures, so if not substantial enough, things can fizzle.”

The policy boosts came after Chinese stocks hit a five-year low as the government’s piecemeal approach to stimulus had failed to fix a crisis of confidence, with deflationary pressure, anemic consumption and an extended property slump combining to erode hopes of a near-term economic recovery. Therefore, the latest efforts may only buy China some time given the scale of challenges facing the economy, according to analysts.