Chinese technology stocks have staged a strong rebound in 2025. The Hang Seng Tech Index (HK:3033), which tracks the 30 largest technology firms listed in Hong Kong, is up 41% so far this year. In comparison, the Nasdaq has gained 17%. The rally marks a sharp shift from the long slump that followed Beijing’s crackdown on the sector.
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AI and Chips Drive the Rally
The upswing began early in the year after DeepSeek introduced an AI model that drew global attention. Since then, investors have become more optimistic about the ability of Chinese companies to compete in advanced technology. Alibaba Group (BABA), Tencent Holdings (TCEHY), and Baidu (BIDU) have all gained ground. Year-to-date, Alibaba is up 96%, Tencent has risen 55%, and Baidu has climbed 60%.
Another driver has been the ongoing progress in domestic chip design. Baidu has expanded its Kunlun processor line, while Alibaba has secured a contract with China Unicom for its Pingtouge, or T-Head, chips. Meanwhile, Beijing has instructed major companies to stop buying chips from Nvidia (NVDA), which signaled that local efforts are gaining traction.
Investor Interest Returns
Investors are now paying closer attention to valuations that remain below prior peaks. Alibaba, for example, is still worth about half of its $860 billion market value before the sector crackdown. Mainland investors have been the main buyers, but foreign investors are also beginning to return. Many see the gains as a chance to rebuild exposure after years on the sidelines.
However, some analysts caution that the rally relies more on sentiment than on earnings. China’s broader economy continues to face slower growth and deflationary pressure, with the CSI 300 index showing flat returns on equity for four straight quarters. For now, optimism appears to be centered on technology rather than the broader market.
Using TipRanks’ Comparison Tool, we’ve lined up and compared the three major Chinese tech companies. The comparison tool helps all investors gain a broader look at each stock and any industry. In this instance, the Chinese tech industry.
