China’s Technology Shares Attract South Korean Investors with Promising Prospects
China’s technology sector has seen increased foreign investment, particularly from South Korean investors, following advancements in AI by DeepSeek. Positive assessments from major banks and government support have boosted this trend. In February, South Korean investments in Chinese tech stocks soared, outperforming their own market, with notable purchases including Xiaomi and BYD.
The surge in China’s technology shares is attracting substantial foreign interest, particularly from South Korean investors. This interest is largely fueled by significant advancements in artificial intelligence from companies like DeepSeek, reinforcing confidence in China’s commitment to technological innovation. As tech shares in the U.S. decline, investors are increasingly looking at opportunities in China’s burgeoning sectors, including AI, electric vehicles, and semiconductors.
Recent comments from Chinese Foreign Minister Wang Yi, likening China to an “anchor of stability” amid global tensions, have further bolstered investor optimism. Haitong Securities acknowledges the tech sector’s growth, attributing it to emerging technologies and government support. Prominent investment banks such as Goldman Sachs and Morgan Stanley have released positive analyses of investment prospects in China’s markets, highlighting the significant technological breakthroughs occurring in the region.
In South Korea, investors are expanding their portfolios in Chinese technology stocks, with trading values reaching a 30-month high of USD 782 million in February. The trading volume of South Korean investors in Chinese stocks has increased nearly threefold since January, surpassing transactions in European and Japanese markets. Six of the ten most purchased overseas stocks by South Korean investors were Chinese tech stocks, particularly in electric vehicles, AI, and semiconductors.
Leading among stocks bought by South Korean investors is Xiaomi Corp, a consumer electronics entity venturing into electric vehicles, with a net trading value of USD 72.4 million. Other popular choices included electric vehicle manufacturer BYD and Alibaba, a key player in e-commerce and AI technologies. In contrast, the South Korean market has seen less than a 2 percent increase since February.
The performance of Chinese indices significantly outpaces that of South Korea, with the Shanghai STAR 50 Index climbing over 15 percent and the Hang Seng Tech Index soaring by 43 percent. Edward Cole from Man Group Plc remarked that China’s stock market has the potential to become the “most convincing” market of 2025, noting its comparatively low valuations, which provide foreign investors with a safety margin and prospects for high returns.
The momentum surrounding China’s technology sector is indicative of a shifting investment landscape, particularly among South Korean investors. With notable advancements in AI and strong government support, Chinese equities are proving attractive amid a declining U.S. tech market. This trend not only reflects growing confidence in the Chinese economy but also anticipates potential gains in a previously undervalued market.
Original Source: www.shine.cn
