Will Chinese AI Stocks Surge Again Amid Multiple Catalysts?
On Wednesday, the $NASDAQ Golden Dragon China (.HXC.US)$ Index gapped up at the open and soared 6.4%, closing at 8,073 points—just a stone’s throw from its September 2024 peak of 8,226 during the last mid-cap rally.
China’s ongoing "Two Sessions" are stealing the spotlight this week. The government’s work report unveiled a 5% GDP growth target for 2025, a 4% deficit rate, and a hefty 1.3 trillion yuan ($182 billion) in special treasury bonds. More importantly, it emphasized "fostering new quality productive forces," a clear nod to tech, AI, and high-end manufacturing—sectors poised to ride this policy tailwind.
This has fueled optimism about China’s economic rebound, driving a valuation repair for Chinese stocks. On Thursday, Hong Kong markets lit up: the $Hang Seng Index (800000.HK)$ climbed 3.3%, while the $Hang Seng TECH Index (800700.HK)$ surged 5.4%. Standouts included $KUAISHOU-W (01024.HK)$, up over 15%, $Kingsoft Cloud (KC.US)$, soaring more than 11%, $JD.com (JD.US)$ and $Alibaba (BABA.US)$, both gaining over 8%, and $TENCENT (00700.HK)$, rising more than 7%.
In our deep-dive analysis yesterday—China's Policy Shifts Unveil Golden Opportunity for U.S.-Listed Chinese StocksTech and Consumer Plays Set to Soar on Reform Momentum—we broke down the Two Sessions in detail. Check it out for the full scoop.
China’s AI Boom Is Heating Up
China’s AI scene is evolving at warp speed. On Wednesday, Alibaba’s Tongyi team dropped its latest open-source reinforcement learning (RL) model, while Manus AI—an agent built by the Monica team—dominated Chinese media headlines, raising the bar for what AI agents can do.
Alibaba officially unveiled its QwQ-32B inference model, a leaner beast with just 1/20th the parameters of DeepSeek R1 but performance that rivals it. The company says QwQ-32B, powered by large-scale RL, delivers a quantum leap in math, coding, and general capabilities—all while slashing deployment costs. Even consumer-grade GPUs can run it locally.
Beyond raw reasoning, QwQ-32B integrates agent-like features, enabling it to think critically, use tools, and adapt reasoning based on real-time feedback.
Meanwhile, Chinese startup Monica stole the show with Manus, an AI agent it claims outshines OpenAI’s Deep Research in assistant benchmarks. Unlike basic chatbots, Manus can independently tackle complex tasks—think data analysis, document processing, travel planning, coding, and content creation—delivering polished results across business, education, and lifestyle use cases.
Chinese AI Stocks to Watch
Boosted by its model launch, BABA surged over 8% in U.S. trading yesterday. As of this writing, it’s up another 2% in pre-market today.
Alibaba’s pouring fuel on the AI fire, pledging over $53 billion in the next three years to build cloud and AI hardware infrastructure—more than its total investment over the past decade.
CEO Eddie Wu, in a recent earnings call, doubled down on the company’s quest for artificial general intelligence (AGI), aiming for AI to hit 80% of human capability.
Bernstein analysts told CNBC that AI optimism could turbocharge Alibaba’s stock, putting earnings on a “more upward trajectory.”
After its late-February earnings, Wall Street heavyweights like Morgan Stanley, JPMorgan, Jefferies, Barclays, Benchmark, and Bernstein raised their price targets. Per Moomoo data, the average target sits at $165—implying 17% upside from current levels.
Tencent’s stock has been on a tear, up over 13% in the past week. Analysts pin this rally on its AI breakthroughs—namely, the explosive growth of its Yuanbao AI app and an accelerating big-model ecosystem.
Institutional investors are reassessing Tencent’s AI potential with fresh eyes. Morningstar analysts argue its current valuation doesn’t fully capture AI-driven growth, especially if Yuanbao sustains its user boom.
Citi’s latest report highlights Tencent’s “dual-engine” AI strategy: deepening ties with DeepSeek to tackle compute bottlenecks while shifting Yuanbao and other core apps to its cloud and industrial unit, signaling a pivot from R&D to commercialization. With WeChat’s 1.3 billion users in play, analysts see Tencent potentially birthing the world’s first “super AI app platform.”
3. AIDC Supply Chain Plays
China’s Kaiyuan Securities flags the AI data center (AIDC) chain as a sleeper hit. As downstream firms ramp up reliance on cloud vendors’ large models, demand for compute infrastructure is set to spike, boosting AIDC suppliers.
With AI app and web usage soaring, inference needs are driving AIDC growth. Keep an eye on rare-resource players like data center builders $GDS Holdings (GDS.US)$ and $21Vianet (VNET.US)$, alongside cloud giants $Alibaba (BABA.US)$, $TENCENT (00700.HK)$, $Baidu (BIDU.US)$, and $Kingsoft Cloud (KC.US)$.
The Bigger Picture
Signs of China’s economic turnaround are stacking up, but inflation and reigniting consumer spending remain top hurdles, says CLSA. While exports offer a cushion, escalating trade tensions underscore the urgency of shifting to consumption-led growth. The government’s pro-private sector and innovation stance—coupled with early stabilization in real estate and corporate earnings—is stoking market enthusiasm.
That said, after this rapid run-up, Chinese stocks could face near-term pullback pressure. Investors should stay laser-focused on AI developments and whether these companies’ fundamentals live up to the hype.
Sources: Bloomberg, AAStocks, Reuters, Investing
by moomoo News Olivia
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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Gold price hits new high! Safe havens in a turbulent market?
🎙️Discussion 1. The spot gold price climbed to an all-time high, with numerous institutions raising their gold price forecasts, how do you
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Apr 15 18:17
Tariff Turmoil Drives Gold Surge: Wall Street Projects $4,500 by Year-End—What's Next?
Chak : they are dependent on nvdia or no ?
fk D J TRUMP Chak : definately not. nvdia depends on Adolf Trump
DAA Chak : There is no sign of NVIDIA at all. Not relying on it.
DAA : The seven little dragons of China will grow up in 5-10 years, so please look up to them then!
xyt DAA : what are the names of the seven little dragons?
DAA xyt : Like Huawei, Semiconductor Manufacturing International Corporation, and so on... you can ask deepseek.
xyt DAA : Deepseek doesn’t consider 华为 or SMIC as little dragons. They are not small anyway. Maybe Deepseek, 游戏科技, 宇树科技, but what else?
DAA : Huawei Zhongxin International
DAA xyt : Alibaba
Gilley : do they make profit xpeng has been out 10 years and still can't but is running better then the good companys by a long shot to