Foreign institutional investors conduct intensive research on A-share companies; technology sector becomes a key focus

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Entering 2026, foreign institutions’ enthusiasm for researching A-shares shows no signs of abating. According to Wind Information, as of February 9, within the year there have already been 224 foreign institutions that conducted a total of 569 research visits to A-share listed companies, including well-known foreign institutions such as Morgan Stanley, BlackRock, Goldman Sachs, and Citibank.

In addition, several foreign institutions have recently released research reports that are bullish on China’s stock market. For example, Goldman Sachs maintains an “overweight” rating on Chinese stocks and predicts that the China index and the CSI 300 Index will each rise by 20% and 12%, respectively. UBS says it holds an “attractive” view on Chinese equities; it expects that the forecast for earnings growth for the MSCI China Index this year will rebound sharply from last year’s 2.5% to 13.6%, mainly driven by technology stocks.

Judging by the foreign institutions’ research targets, Huaming Equipment, Yingshi Innovation, and Inovance Technology rank in the top three. In addition, companies such as Optek, Yiheida, Anji Technology, CR Micro, and Sietai have also attracted more than 20 foreign institutions to conduct research. This shows that foreign institutional research mainly focuses on sectors such as semiconductors and robotics.

The UBS Wealth Management Investment Director Office (CIO) said that the China market has growth and return potential. China continues to promote technological innovation and self-reliance and self-strengthening, creating a favorable business environment for companies. At the same time, tailwinds such as healthcare enterprises “going global,” the rise of new consumption models, and the modernization of the power grid are expected to benefit industries including healthcare, consumer sectors, materials, and power equipment.

Ma Lei, Chief Investment Director for Mainland China and Hong Kong at Invesco, said: “Looking ahead to 2026, we remain optimistic about China’s stock market. Continuously improving fundamentals and long-term growth drivers are expected to create a more sustainable structural growth cycle.”

When discussing investment opportunities in China’s stock market, Ma Lei believes there are three main areas. First is industrial upgrading. Key industries such as electric vehicles, pharmaceuticals, and automation are expected to drive growth in the next stage. Companies with solid R&D capabilities can seize market demand for advanced products and solutions. Second is the AI trend. DeepSeek, released at the beginning of 2025, shows that China is able to provide large language models that combine cost efficiency with high performance, and it also signals that China has become a strong competitor on the global AI track. China has one of the largest internet user bases in the world, relatively low energy costs, and the baseline conditions to support large-scale AI development and deployment. Moreover, China’s abundant talent reserves, vast data resources, and efficient automated scaling capabilities give it a competitive advantage in turning AI innovation into tangible improvements in productive capacity. Third is consumer evolution. Affected by changes in population structure and the continuous evolution of consumers’ preferences, China’s consumer market may undergo a major transformation in the future. More and more young groups are allocating their budgets to service-oriented and IP-based products, including online games, tourism, entertainment, and social media. It is expected that more outstanding companies will emerge in related industries.

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