The Ai Mania, fuelled by DeepSeek, the giant model of artificial intelligence, is driving global capital flows to China. Bloomberg reported on the 16th that, based on optimism about the rebound in tech stocks driven by DeepSeek and expectations of more economic stimulus policies in China, over the past month, global hedge funds are piling into Chinese equities at the fastest rate in months.
China’s onshore and offshore markets added more than $1.3 trillion in market value over the past month as global capital assets were reset, according to Bloomberg, india’s market shrank by more than $720 billion.
“While money has been flowing into India in the past, this shift marks a shift in the market, where the value of Chinese assets, especially technology, is being revalued to regain their former attractiveness,” the report said.
Jiaquan Huang, an expert on Asian equity portfolios at Global Asset Manager Hanya Investments, told Bloomberg that the emergence of DeepSeek confirms that Chinese companies have indeed become an important part of the entire AI ecosystem. His firm has been overweight Chinese internet stocks in recent months and underweight small-cap Indian stocks that are trading“Well above their valuations”.
Vivek Dawan, fund manager at asset management firm Candriam, said Deepseek’s push into artificial intelligence could further boost China’s economy and market, from a risk-reward perspective, the Chinese market is now more attractive than India’s.
Valuation differences also add to the appeal of Chinese assets. The MSCI China Index Trades at just 11 times forecast earnings, compared with about 21 times for the MSCI India Index. The lower the P/E ratio, the higher the surplus on an investment of the same amount.
Andrew Swan, head of Asian equities at Hedge Fund Man Group, said that while DeepSeek had helped accelerate inflows into China, the country’s predictable economic policies were also important to the market. Last year, his fund increased its exposure to China from 30 per cent to 40 per cent.
Bloomberg said that despite doubts, hesitancy view, but the recent market has clearly seen a“Return of China” wave, the market positive factors are accumulating. Alibaba’s market capitalisation has risen by $100bn in the past five weeks, while the Hang Seng Technology Index has gained more than 30 per cent in just one month, the report said.
Yang delong, chief economist of Qianhai Open Source Fund, told the global times that after the spring festival, sentiment in China’s capital markets continued to warm up, especially the emergence of DeepSeek, international investment banks and financial institutions such as Goldman Sachs, Bank of , Deutsche Bank and Belaid have recently expressed bullish views on Chinese assets. Yang delong believes that China’s stock market valuation is at a historical low level, 2025 macro-incremental policies will be introduced, and with the stock policy to play an effective.