China's stock market has been on a roll — is it a boom or a bubble?

Market Overview - China's stock market has experienced a significant rally this year, driven by advancements in artificial intelligence, efforts towards chip self-sufficiency, and government initiatives to control price wars [1] - The mainland CSI 300 index has increased approximately 16% since the beginning of the year, nearing three-year highs, while the CSI 300 Information Technology Index reached its highest level since 2015 [2] Investor Behavior - Retail investors are a major force in the current equity rally, with around 90% of daily trading volume in China's onshore stock markets attributed to them, contrasting sharply with global exchanges where institutional investors dominate [3] - There has been a notable shift of retail investors moving funds from bank deposits into equity markets, indicating a change in investment strategy [3] Economic Context - Total Chinese household savings have reached over 160 trillion yuan (approximately $22 trillion), marking a record high, yet only 5% of these savings are invested in equities, suggesting potential for increased retail market participation [4]