UBS Wealth Management: China's stock market still has room for growth next year with AI and technology driving long-term profit growth.

UBS Wealth Management Chief Investment Office issued an institutional perspective, stating that the bullish trend in the Chinese market is expected to continue in 2026, with advanced manufacturing and technological self-reliance becoming new growth engines. With domestic investors entering the market and global capital adjusting allocations, there is still room for upward movement in the Chinese stock market. Currently, AI and technology are key drivers of long-term profit growth, and the technology sector is increasingly resilient to fluctuations in the US economic cycle and external impacts. China's pace of AI monetization is ahead of other markets, and it is expected that the Hang Seng Technology Index will see a 37% increase in earnings per share in 2026. Against the backdrop of low interest rates and limited alternative investment options, the excess savings of around 7 trillion yuan held by residents are expected to flow into the stock market. The outlook for the Chinese market remains positive, with a focus on cloud computing, e-commerce, AI, digital infrastructure, as well as selected telecommunications, financial, and utility companies.