Why Chinese Stocks Alibaba, Futu Holdings, and Tencent Shook Off Inflation Concerns and Are Rising Today

Group 1: Market Reaction to Inflation and AI Developments - Chinese tech stocks have shown resilience despite a hotter-than-expected inflation report, with significant gains observed in the sector following the emergence of China's DeepSeek AI chatbot [1][4] - The Hang Seng Index has increased nearly 16% over the last month, indicating a positive trend in Chinese tech stocks despite ongoing economic challenges [4] Group 2: Company-Specific Developments - Alibaba's shares rose by 4.4% following reports that Apple is collaborating with the company to enhance AI features for iPhone users in China, which may improve competitiveness against local rivals [2][5] - Futu Holdings experienced an 8.4% surge after Bank of America reiterated a buy rating and raised its price target from $108 to$129, anticipating a 30% quarterly increase in new paying clients [2][6] - Tencent's shares increased by 3.5%, benefiting from the overall positive sentiment in the tech sector, particularly regarding advancements in AI [2][7] Group 3: Valuation and Investment Outlook - Chinese tech stocks are trading at cheaper valuations compared to U.S. stocks, which may attract investors looking for growth opportunities amid elevated U.S. valuations [8] - Analysts express bullish sentiments towards Alibaba, Futu, and Tencent due to their strong potential for growth, although they caution about potential volatility stemming from economic struggles and government influence [9]