Author Ankur Bernerjee, Summer Zhen
Singapore/Hong Kong (Reuters) -Like President of US President Donald Trump, a recession fears, global investors found a little probably a new shrine: Chinese shares.
Hong Kong -O’s reference Index Hang Seng – where many major Chinese companies are on the list of many major Chinese companies – has increased by 17% since Trump entered the White House in January.
This is compared to a fall of about 9% in the S&P 500, which also dropped $ 4 trillion market values from a record maximum last month.
Trump’s embarrassing pronouncing on tariffs and moves to reduce the consumption of the Federal Government challenged the assumptions about US shares complaints, which significantly surpassed most of their global colleagues of 2021.
Investors have moved from belief to “Tina” – there is no alternative to the US property – on “Tiara” – there is a real alternative – said Andy Wong, a higher executive director based in Hong Kong to Pictet Asset Management.
A large part of the Chinese gathering led technological shares that so far increased 29% in 2025, hitting their highest level in more than three years last week. Like many new bulls in China, Wong said he saw opportunities in technology, defense and consumer games.
Key reason for optimism: Chinese sections are cheap, trade 30% according to 2021. The Hang Seng Seng Index is 7 times more than the projected 12 -month earnings – which is the most commonly used metric for stock prices – compared to 20 times for S&P 500, according to LSEG data.
To be sure, Chinese shares traded cheap for a reason. Many investors have been burned after a pandemic government in government traffic on technological shares and remain questions in the real estate and economy market. Concerns of the concentration of power in the White House increases in Beijing, where President XI Jinping does not have serious political opposition.
But investors see a lot upside down after a large gathering in technological shares after AI startup Deepseek’s dirty debut of his R1 resolution model. The prospects for a fiscal impetus that could raise consumption – a long withdrawal for the Chinese economy – is another tail wind.
Although some of the renewed global interests for the Chinese shares have come to the detriment of US shares, investors are also moving from South Korea and Indian combat markets, according to Reuters interviews with more than a dozen funds managers and strategists.
JP Morgan has recorded a record amount of American dollars and Chinese Juan, which have been turning into Hong Kongo dollars in the last few weeks, pointing to the force of money that has passed in the stock in Hong Kong, said Serena Chen, head of the company, currency and emerging markets. Did not determine the amount or time period.
Leo Gao from Greenwoods Asset Management said he sold all the US companies in his portfolio in early February, shortly after the appearance of Deepseek.
Older portfolio manager at one of the largest Asian Hedge Funds said in March to investors that he is now particularly noisy in Chinese technological companies and other companies that meet the change of consumer habits.
Going to China
Trump refused to exclude the prospects for the world’s largest economy over the weekend, worsening fears on the market. Investors also negatively responded to the instability of decision -making in the White House, which issued delays in the last minute on tariffs to Canada and Mexico.
Slow down economic data further increases doubt about whether the growth can surpass the rest of the rich world for a longer time. The assessments of American shares are high and subject to any hint of trouble.
Trump has so far diminished market turbulence and has repeatedly said that “the tariffs would make our country rich.”
In the meantime, China has developed an incentive and support measures for its economy and markets. In February, Beijing held a meeting between the XI business leaders who took the investors widely as a positive signal.
“China is now an adult in the room,” said Dong Chen, a chief Asian strategist at Pictet Wealth Management.
Machines based abroad invested $ 3.8 billion in Chinese shares in February, after three direct months of withdrawal, Morgan Stanley showed data.
Kamal Bhatia, the New York Executive Director of the General Management of Asset Management, said that long -term investors loved predictability.
“Even very large sophisticated investors do not want their investment thesis to change over three years,” he said.
Some investors have noticed the irony of rally in the markets of Europe and China, which Trump singled out as geopolitical rivals.
“The pressure that Trump’s administration puts on foreign government … In fact, in many cases, it has resulted in surpassing from these countries,” said Ross Mayfield, an American investment strategist at Baird.
The future fiscal basook in Europe after Trump has doubted his willingness to defend the NATO allies defense has also encouraged the prices of shares of defense companies in the region. European capital has long faced winds that include higher income tax rates, slow economic growth and lack of main technological companies.
“As investors adapt to the narrative change, Capital will bounce off previously full of winners,” Pictet’s Wong said.
Structural or short -term?
In addition to concern about Chinese corporation reporting standards, deflation pressures and a renewed trade war with us seek feelings.
The shares grew in September after Beijing discovered stimuli measures, but the rally ran quickly.
“Still, people have a traumatic experience with Chinese shares,” Pictet’s Chen said. “China used to be called unusable, and so this deflamation type of narrative has not yet completely dispersed.”
Bhatia said his clients ask more about tactical extracts, an investment strategy aimed at using trends and economic changes with short -term bets.
“In the last ten days, it has made it very clear that it is worth it to have a regionally diverse distribution strategy,” said Lilian Haag, a senior portfolio manager at DWS.
(Reporting Ankur Banerjee and Tom Westbrook in Singapore, Summer Zhen and Jiaxing Li in Hong Kong; An additional reporting of Kevin Buckland in Tokyo and Lisa Pauline Mattackal in Bengaluru; Mount Vidya Ranganathan and Katerina and Katerina)
