China’s Technology Stocks Thrive Amid Foreign Interest, Especially from South Korea
China’s technology shares are witnessing a boom, particularly due to advancements by DeepSeek in AI. Foreign investments, especially from South Korea, are rising, supported by positive government sentiments and investment bank reports. Consequently, technology indices in China have significantly outperformed South Korea’s market, making them attractive for foreign investors seeking better returns.
China’s technology shares are experiencing significant growth, driven largely by advancements in artificial intelligence from companies like DeepSeek. As the technology sector in the U.S. struggles, foreign investors are increasingly interested in China’s sectors, particularly in AI, electric vehicles, and semiconductors, capitalizing on China’s commitment to technological innovation. Foreign Minister Wang Yi’s comments portraying China as an “anchor of stability” amid global tensions have further elevated investor confidence.
Haitong Securities noted that since early 2023, the tech sector in China has been booming, fueled by emerging technologies from DeepSeek and supported by government policies. Foreign investment banks, such as Goldman Sachs and Morgan Stanley, have released positive assessments on Chinese markets, citing recent technological breakthroughs.
The increase in interest from South Korean investors illustrates this trend, as they have significantly augmented their Chinese tech stock portfolios. Market data showed that trading volume surged to US$782 million in February, marking a 30-month high. South Korea’s trading in both mainland China and Hong Kong shares nearly tripled, surpassing investments in European and Japanese stocks.
Among the top stocks, Xiaomi Corp, which has ventured into electric vehicle manufacturing, stood out with a net trading value of US$72.4 million. Other prominent stocks included BYD, a major electric vehicle manufacturer, and Alibaba, a leading e-retailer and AI player. In contrast, South Korea’s own stock market remains stagnant, with the Korean Composite Stock Price Index showing less than 2% growth since February.
In comparison, China’s STAR 50 Index, aligned with science and technology stocks, has surged over 15%, while the Hang Seng Tech Index has skyrocketed by 43%, outperforming various global indices. According to Edward Cole, an analyst at Man Group Plc, the Chinese stock market is on track to be the most “convincing” market of 2025, as it continues to be undervalued relative to its global counterparts, providing foreign investors with a strong margin of safety and high-return potential.
In summary, China’s technology sector is flourishing amid U.S. market challenges, attracting increasing foreign investment, particularly from South Korea. With advancements in AI and government support, Chinese technology shares have shown exceptional growth. The comparison of performance between Chinese and South Korean markets highlights the appeal of Chinese equities, particularly in sectors like electric vehicles and semiconductors, which showcase strong bullish momentum that suggests favorable conditions for foreign investors moving forward.
Original Source: www.shine.cn
