Growth in China's tech stocks just getting started, JPMorgan banker says

Core Insights - The recovery of China's tech stocks is in its early stages, driven by the country's rise as an artificial intelligence superpower attracting Western capital [1][4] - Chinese entrepreneurs are expanding globally and increasing their involvement in AI, which is rekindling international investor interest after years of stagnation [2] - Investors are currently underexposed to AI trends in China, leading to a lean-forward sentiment among them [3] Investment Trends - Global investors are reallocating funds to major Chinese tech companies, benefiting from recent policy stimulus and technological advancements, although allocations remain below levels seen from 2015 to 2021 [4] - The price-to-earnings multiples of Chinese tech companies are lower compared to US peers with similar growth rates, indicating a potential for convergence in valuations [5] - US investment firms are increasingly interested in Chinese equities, with Hong Kong-listed stocks providing diversification opportunities [5] Regional Investment Dynamics - Investors from the Middle East, Southeast Asia, and Europe are focusing on gaining exposure to China, providing a balanced funding source for Chinese tech firms [5] - The Middle East is characterized by long-term capital seeking exposure to China's digital economy, while European investors view China as a safe haven due to fewer native AI companies [6]