Shares of Chinese consumer and tech leaders PDD Holdings (PDD -5.61%), Tencent (TCEHY -4.79%), and electric vehicle (EV) leader Li Auto (LI -5.22%) plunged today, down 6.1%, 4.8%, and 4.4%, respectively, as of 12:07 p.m. ET.

Chinese stocks had a vicious rally beginning in September with the announcement of general stimulus plans from the government. However, stocks are now pulling back as investors fear the actual measures and their details may not be enough to revive growth.

Last night, disappointing September trade data led to a further pullback after last weekend's announcement from the country's finance minister was also light on details. Hence, consumer names in China are pulling back hard after a strong month-long run.

Weak trade data Monday follows a disappointing weekend

On Monday night, China released trade data showing exports rose 2.4% over the past year, and imports rose 0.3%. While both growth figures were positive, each figure was well below expectations. Remember, China is an emerging economy, and its leaders have set a 5% growth target for the year.

The disappointing trade figures follow Sunday's consumer price index, which showed just a 0.1% increase in prices in China in September, the lowest rate since February 2021. While low inflation would be a positive in countries trying to solve the post-pandemic inflation problem, too-low inflation is a problem if one's economy is stalling. The figure seems dangerously close to deflation, which would become a larger problem.

The data Sunday and Monday night followed the somewhat disappointing announcement from China's finance minister, Lan Fo'an, on Saturday. While Fo'an disclosed plans to help shore up the country's regional banks in an attempt to stabilize the property market, there were few details on direct fiscal stimulus to households that many had been hoping for. Last night, China's Caixin media reported the government may raise $846 billion in special long bonds to help local governments plug holes in their off-balance sheet debt.

While investors had high hopes and the $846 billion measure sounds fairly large, China is a huge country, and clearly, some were expecting more. To date, these measures mostly seem to be an attempt to plug holes in local and regional governments and banks, not the "bazooka" to consumers that could revitalize demand.

Thus, it's no surprise that even the fastest-growing e-commerce company, PDD; the leading social media company, Tencent; and one of the leading electric vehicle companies, Li Auto were down sharply today. This is especially true as each had rallied viciously between mid-September and early October. PDD and Li each experienced a 50%-plus rally between Sept. 13 and Oct. 7, while Tencent had rallied over 20% before each of those rallies began to fade.

Once again, investors are divided on China

Remember, very smart hedge fund managers are on opposite sides of the China trade following last month's stimulus measures. While Beijing has seemingly gotten serious about tackling its property sector problems and the need to restimulate demand, China has a lot of holes to fill. Moreover, it will likely take a much bigger stimulus to improve consumer confidence to get growth going again. And of course, it may be hard to count on a long-lasting effect from near-term stimulus if the country does not enact more capitalism-friendly structural reforms.

Beijing is likely to announce more stimulus measures through the rest of the year, but don't expect the bull versus bear debate on Chinese stocks to be resolved anytime soon.