The tech industry in China is booming; the Hang Seng Tech Index is almost about to get to its highest peak since the country reopened from COVID-19. As of Thursday, the Chinese technology companies benchmark in Hong Kong grew by 2.3 percent when investors were quite optimistic about the future of AI.

The emergence of DeepSeek, an AI startup in China, has triggered the discovery of which companies in the country will especially benefit from the amazing progress in the field of large language models. This move has once again encouraged bargain hunters to bet on cheap IT shares as the Hang Seng Tech Index still sold at 17.4 forward multiples against the five-year average of 24.5 times. The experts claim that the strong business scenario for a potential re-rating is especially evident in Hong Kong, where valuations are still regarded as cheaper.

The rally in Chinese tech was accompanied by an overall positive development of the country’s economy and in the midst of a trade-recovery phase, despite the international political tensions and the rise of protectionism. In contrast to the increased trade tensions and risks of a decided global recession, the world’s top-tier companies (Tesla, Toyota, Siemens Healthineers, etc.) are binding the country with their heavy investments. This fact alone shows a winning move that China decided to make in order to keep the global market within its reach and, therefore, attract more skilled workers alongside the investment capital.

The vastness of China’s market now ranked second in the world with an ever-growing middle class, makes it an indomitable investment destination for today’s global manufacturers and investors. In the year 2024, China’s Gross Domestic Product (GDP) hit an unprecedented figure of 134.91 trillion Chinese yuan, which is equal to approximately US$ 18.81 trillion. This economic power, combined with the country’s skilled supply chain and modern manufacturing ecology, attracts high-value, technology-intensive investments.

The Chinese government’s dedication to opening up and win-win cooperation is the major reason for boasting of well-maintained investor confidence. In recent years, China has made significant progress in promoting high-standard openness by doing things such as reducing the negative list for foreign investment, canceling the limitations for foreign investors in manufacturing, and expanding the list of unilaterally opened countries to the least-developed countries. These activities caused as much as 9.9% of new foreign-funded organizations in China.

To this end, Chinese officials emphasized the priority of high-standard economic openness in the year 2025. The State Council lately validated a foreign investment support plan for the year 2022, which outlined practical and more effective measures to lure foreign capital. This resolution is expected to augment investor confidence, thus attracting more investments and creating a tech breakthrough followed by other sectors.

The ongoing Chinese tech rally is a subject of interest for investors and analysts who are anxiously looking for the first sustainable signs and the possible hurdles to come. The factors that today lead the stock exchange to growth could be, in prospect, on the negative side of the global economic conditions or the tensions among the countries. To conclude, the upsurge in the shares of Chinese companies that are tech-oriented mirrors the growing optimism regarding the nation’s intelligence and the toughness of the demand for stocks in the economy.