An illustration depicting an AI robot interacting with stock market candlestick chart Photo VCG

Chinese stocks have kept on rallying lately, showing strong resilience amid global financial market volatilities. As a result, multiple financial institutions have upgraded their ratings for Chinese equities.
Morgan Stanley recently upgraded its rating on Chinese stocks, calling it "the optimal time for global investors to increase allocations," the Securities Times reported.

Laura Wang, Chief China Equity Strategist for Morgan Stanley, highlighted China’s breakthroughs in AI and other tech sectors, particularly the rise of DeepSeek, have reshaped overseas perceptions and strengthened investor confidence in China’s ability to drive new growth.

“Global allocations to Chinese assets remain historically low, implying substantial upside potential from incremental capital inflows,” she added.

Goldman Sachs shared a similarly bullish outlook, forecasting that AI adoption over the next decade could lift the earnings of Chinese stocks by 2.5 percent annually. It has also raised targets for the MSCI China Index and the CSI 300 Index to 85 and 4,700, respectively, signaling potential double-digit growth for both indices over the next year, Xinhua News Agency reported.

Citi also upgraded its rating for Chinese stocks to overweight. Chinese shares look attractive even after their recent rallies, Citi strategists wrote, citing DeepSeek's AI technology breakthrough, the government's support for the tech sector and "still-cheap valuations," according to Xinhua. 

Yang Delong, chief economist at Shenzhen-based First Seafront Fund, told the Global Times that DeepSeek’s breakthroughs have eased concerns about China’s tech constraints caused by US’ chip export controls, solidifying foreign confidence in China’s AI development. 

At this year’s Two Sessions, Wu Qing, head of China’s top securities regulator, noted that DeepSeek’s success has not only shaken the global AI industry but also reshaped global perceptions of China’s technological innovation, triggering a revaluation of Chinese assets.

To support high-quality tech listings, China will adopt more inclusive issuance and listing systems, leveraging mechanisms such as the "green channel" and supporting the listing of pre-profit enterprises, Wu said.