Global investor confidence in China equities at highest in two years – UBS

Global investors’ concerns about China equities seem to be their lowest in two years, thanks to the recent market surge and confidence in the country’s tech sector and policy support, according to UBS.

Lei Meng, China equity strategist at UBS Securities, said that the interest and sentiment toward China equities has improved significantly based on the broker's talks with dozens of investors based in Asia-Pacific and Europe over the past month.

Artificial intelligence, humanoid and industrial robots, intelligent driving and other related sectors remain investor darlings, Lei added. 

Lei attributes the optimism to the rapid market rebound, alongside the confidence boost by China's spark of tech innovation and a full range of policy easing measures.

Hong Kong’s Hang Seng Tech Index leapt over 19 percent since the start of the year, ignited by Chinese startup DeepSeek’s low-cost AI model and the rising humanoid robots sector. In comparison, the tech-savvy Nasdaq Composite posted a 7.7 percent fall year-to-date.

UBS also found that global investors pay more attention to near-term dynamics such as policy signals, the scale of fiscal stimulus, property activities, the pace of household consumption recovery, and changes in capacity utilization across sectors, rather than to longer-term structural topics like population aging, Sino-US tensions and the social security system.

The shift, said Lei, reflects that international investors are trying to identify opportunities from near-term macro trends.

In addition, UBS noticed that some long-only investors are seeking the chance to buy Chinese assets at the dip, considering the signs of a stabilizing property market in tier 1 cities, examining more quality products and contents, as well as reviewing the new rounds of consumption stimulus policies.

THEMIS QI