LIVE MARKETS-Fidelity says this China rally is different

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FIDELITY SAYS THIS CHINA RALLY IS DIFFERENT

Chinese shares have had a strong February, particularly Hong Kong-listed tech names. But 2024's highly volatile trading has left real money unsure about whether to invest and focused on the short term..

But George Efstathopoulos, portfolio manager, multi asset, Fidelity International, says this year, things feel different.

Last year's rallies were based on hope of markets stimulus, while this time, "fundamentals are in the driving seat."

He points to the emergence of Chinese artificial intelligence and DeepSeek which "challenges the view that China is vastly behind the US on the tech front. This has been a strong reminder to investors that China can, and does, innovate."

In addition, Efstathopoulos notes, there has been better economic data, including in consumption, which suggests fiscal policies can boost consumption, even though more is required, as well as green shoots in the property market.

Hong Kong's Hang Seng index is up 17% in Feb, led by tech .HSTECH up 24%.

(Alun John)

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