The great Chinese securities come back to the Trump

Hang Seng Index – where many large Chinese corporations listed – increased by 17% since Mr. Trump entered the White House since January. Meanwhile, the US S&P 500 index decreased by about 9%, and evaporated US $ 4,000 billion in market capitalization compared to the nearest peak.

This opposite development marks a significant change. Since 2021, US stocks have surpassed most other markets globally. With a continuous stock price of a record, US stocks were “the only choice” then, according to The Economist. However, the confidence of investors in the outstanding difference in Wall Street is being shaken, due to weak economic growth prospects and “erratic” protection policies of President Donald Trump.

Over the weekend, Mr. Trump refused to rule out the possibility of recession from the world’s largest economy, increasing the market’s concern. Despite the panic Wall Street, the president still overlooked the concerns and repeatedly affirmed that “tariffs will help America to be rich”.

Meanwhile, the world’s second largest economy is actively implementing economic stimulation measures and market support. In February, Chinese President Xi Jinping met private business leaders, considered by investors as a positive signal. “China is now a mature and responsible party,” Dong Chen, the patriarchal strategist in Asia at the Pictet Wealth Management, commented.

Andy Wong, a senior director at Pictet Asset Management (Hong Kong), said the investor has moved from faith in Tina (There is no alternative – no alternative to American assets) to Tiana (There is a real alternative – having a true alternative).

With the prospect of weak economic growth and the erratic protection policies of Mr. Trump, investors are becoming more cautious with US stocks that have high P/E, especially when compared to other listed companies in other markets – where cheaper valuation (lower P/E).

Previously, they accepted high P/E for great profit margins and more strong growth prospects. Now, the stock valuation is very high is the reason why the market is vulnerable to any signs of instability.

Therefore, many investors leave, looking for other options that are considered safer and more promising as mainland Chinese securities, Hong Kong. According to data from Morgan Stanley, foreign investment funds poured US $ 3.8 billion into Chinese shares in February, marking the reversal after three consecutive months withdrawing capital.

Kamal Bhatia, CEO Principal Asset Management in New York, said long -term investors always prioritize stability. While, Reuters Commented that Mr. Trump is making Chinese shares somewhat “great back”, compared to the message “Bringing the United States of the Great America” ​​of the president.

The reason why some investors seek to the Chinese stock market is the stock price here significantly cheaper. Currently, the Seng cave index is priced at 7 times expected profits in the next 12 months, while this figure in the US S&P 500 is 20 times, according to data from LSEG. Compared to the peak of 2021, Chinese stock price is currently about 30%lower.

Along with that, the Chinese stock market earlier this year increased to 29%, largely thanks to technology stocks. Wong said it was particularly optimistic with technology stocks, defense and businesses focusing on consumers.

Investors see great growth opportunities after Deepseek, Artificial Intelligence Startup (AI) caught the attention of the R1 model launch. The prospect of the Chinese government implemented fiscal stimulus measures to promote consumption – the long -standing field is the weakness of the economy – also supporting optimistic psychology.

Climbing Gao, managing a high -level portfolio at Greenwoods Asset Management, said it sold all US shares in early February, right after Deepseek announced the new AI model. In a meeting with investors in March, Gao said he was particularly optimistic about Chinese technology companies and businesses that meet the needs of consumer changes quickly.

However, Chinese securities are not entirely the promised land. Theo Reutersstocks in this country are cheap. Many investors have suffered heavy losses after technology corporations were tightened to manage. Meanwhile, persistent concerns about the financial reporting standards of Chinese companies have not completely disappeared.

In addition, there are still doubts about the real estate market and the health of China’s economy. The country is under pressure of deflation and the risk of American -China Trading. Some concerns returned on March 9, when data showed that consumer prices decreased in the first 2 months of the year.

Dong Chen said that many investors still have very bad memories with the stock of this country. “Previously, it was thought that the Chinese market was not worth investing, so the psychological concern about deflation was not completely disappeared,” he said.

Economist Note that the concern is that the current hot growth of Chinese securities is largely thanks to the psychology of excitement with AI, exploding after the models developed by DeepSeK attracted global attention. Seng Tech cave index, including some of China’s largest technology companies, increased by more than 40%, when investors rushed to buy stocks related to AI. This excitement reminiscent of AI fever in the US last year, many stocks later dropped sharply.

Bhatia said his customers are increasingly interested in strategy of distributing tactical assets, which means taking advantage of the trends and economic fluctuations to implement short -term investments.