China's Tech Stock Boom Defies Economic Woes, Driven by AI and Innovation
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Moneycontrol•18-01-2026, 07:56
China's Tech Stock Boom Defies Economic Woes, Driven by AI and Innovation
- •China's tech stocks are surging in early 2026, fueled by advancements in AI, robotics, and commercial rockets, despite a fragile economy.
- •An onshore Nasdaq-like tech gauge is up almost 13% this month, and Hong Kong-listed Chinese tech firms climbed nearly 6%, both outperforming the Nasdaq 100.
- •DeepSeek's AI breakthrough last year and upcoming R2 model, along with a focus on homegrown tech, are key drivers of the market rally.
- •Investors are re-evaluating China as a credible challenger to US tech leadership, moving beyond its low-cost manufacturing image.
- •Concerns about stretched valuations and Beijing's tightening of margin financing exist, but state backing and a low-cost AI model strategy offer optimism.
Why It Matters: China's tech sector is experiencing a significant stock rally, driven by AI and innovation, challenging US tech dominance.
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