Foreign investment institutions are increasingly bullish on Chinese assets, signaling a strong growth trajectory for the Chinese stock market by 2025. Leading investment banks such as Deutsche Bank, Goldman Sachs, HSBC, and Bank of America are at the forefront of this optimistic outlook.
Deutsche Bank highlights the competitive advantages of the Chinese mainland's manufacturing and service sectors. In a recent report, the bank stated that investors are beginning to recognize the superior value and quality offered by Chinese companies. Deutsche Bank anticipates that the longstanding \"China discount\" on valuations will soon disappear, transforming into a premium as global investors acknowledge China's dominance across various industries.
Echoing this sentiment, Goldman Sachs points to the rise of DeepSeek as a significant catalyst for Chinese technology stocks. The New York-based investment bank projects a 14% to 28% increase in the MSCI China Index, with A-shares benefiting from advancements in artificial intelligence software. The emergence of DeepSeek, a Chinese AI company, has captured global attention by claiming that its latest reasoning model, R1, rivals OpenAI's o1 in problem-solving capabilities while being more cost-effective. This development has ignited bullish sentiments within China's AI sector.
HSBC analysts have noted that the global spotlight on DeepSeek could lead investors to reassess China's innovation capacity. This reassessment is expected to act as a catalyst for a reevaluation of the Chinese equity market this year, according to reports by Investing.com.
Additionally, Bank of America has expressed a favorable stance towards Chinese equities, recommending investors take long positions on Chinese stocks while exercising caution regarding the US stock market, as reported by Bloomberg.
These positive assessments from major investment banks collectively underscore a growing confidence in the Chinese market. They highlight the increasing attractiveness of Chinese assets to global investors, reflecting China's dynamic and influential role in the global economic landscape.
Reference(s):
cgtn.com
