A tariff storm has roiled global financial markets. Amid the turbulence, DeepSeek has triggered a wave of optimism, reinforced by a series of stabilising policy measures, leading to a new round of reassessing for Chinese assets.
As of May 9, major A-share indexes have recovered the ground lost since the announcement of “reciprocal tariffs”, with some benchmarks even outperforming levels seen before the market plunge on April 7. Meanwhile, the RMB has reversed its previous downward trend—a pattern typical during past US-China trade frictions—and has surged to a six-month high against the US dollar. Amid the backdrop of interest rate and reserve requirement cuts, China’s 10-year government bond yield has dropped from 2% in March to around 1.6%, indicating rising bond prices.
The revaluation of Chinese assets is being driven by a consensus among domestic and international investors. Since Q1, funds related to semiconductors, industrial metals and passenger vehicles have seen strong inflows. According to data from Goldman Sachs, between March 27 and April 23, global equity funds saw net inflows of $68.08 billion, of which emerging markets received $27.14 billion. Chinese equity funds led the pack with $24.686 billion, far ahead of other emerging markets such as South Korea, India and Brazil.
