By John Cheng, Bloomberg Markets Live reporter and strategist
DeepSeek’s breakthrough in artificial intelligence is helping drive a rotation of stock funds back into China (see "Goldman Trader On The Next Great Rotation: Out Of Mag7 And Into China") from India and elsewhere. Hedge funds have been piling into Chinese equities at the fastest pace in months as bullishness on the DeepSeek-driven technology rally adds to hopes for more economic stimulus. In contrast, India is suffering a record exodus of cash on concerns over waning macro growth, slowing corporate earnings and expensive stock valuations.
"HFs net bought Chinese equities at the fastest pace in over 4 months, driven almost entirely by long buys. China (onshore + offshore) has been net bought in 7 of the last 10 weeks and is by far the most notionally net bought market on the Prime book YTD." - GS Prime pic.twitter.com/raXUu98Gi4
— zerohedge (@zerohedge) February 11, 2025
