What happened

Shares of several Chinese stocks moved higher today on Wall Street bullishness and after more positive comments made by President Joe Biden recently on U.S.-China relations.

Shares of the large tech conglomerate Alibaba Group (BABA 0.79%) traded more than 3% higher as of 10:50 a.m. ET today.

Meanwhile, shares of the online agricultural e-commerce company PDD (PDD 2.25%) traded nearly 5.5% higher, while shares of the Chinese biopharmaceutical company Zai Lab (ZLAB) were up more than 8%.

So what

Chinese stocks have struggled more recently as investors question the durability of China's economic recovery and grow increasingly concerned over geopolitical tensions between the U.S. and China.

People looking at upward moving charts.

Image source: Getty Images.

But many Wall Street analysts are still quite bullish on Chinese tech stocks and believe there is plenty of room to run for the sector.

Ronald Keung, who leads research of Asian internet companies at Goldman Sachs, told CNBC Friday that while e-commerce has not bounced back quite as fast as the market might have expected, there are green shoots.

"I think the e-commerce numbers do show some of the recovery on a one-year basis and on a two-year basis, we are seeing some signs of this consumption gradually recovering," he said, adding that most large Chinese tech companies have seen their first-quarter earnings beat consensus estimates. "Travel has been strong and goods kind of started to really pick up in the month of March with apparel."

In other news, President Joe Biden recently made comments that seemed to play down the growing tension between China and the U.S. Notably, Biden said that some of the tension seen in recent weeks should settle down "very shortly," according to Reuters.

"In terms of talking with them, I think you're going to see that thaw very shortly," he said. "We're not looking to decouple from China. We're looking to de-risk and diversify our relationship with China."

An easing of these tensions would likely benefit a company like Zai Lab, which is based in the U.S. and China.

However, Biden's comments came before the Cyberspace Administration of China issued a statement saying that American chipmaker Micron Technology is "a major security risk" to "key information infrastructure supply chain" in China and therefore is considered a danger to China's national security. The Chinese government also told domestic companies with "critical information infrastructure" to stop buying Micron's chips.

Now what

The news regarding Micron is certainly a big deal when it comes to U.S.-China relations, and the U.S. Commerce Department has already said it is not happy with the news. It will be interesting to see what Biden says or does in response to this.

But assessing geopolitical tensions and how they can impact Chinese stocks is part of investing in the sector and one of the risks that come with investing in China's massive market opportunity.

Of these three companies, I currently only like Alibaba. I tend to prefer larger Chinese stocks. While PDD has a great business, recent spying allegations could be a big deal and weigh on the stock. I would like to see how this plays out before I would consider getting more bullish on the company. I like Alibaba's new plan to divide into six different divisions and think this will provide positive upside to its valuation.