JP Morgan is optimistic about the materials, brokerage, insurance, consumer staples, and robotics sectors, with a year-end target of 100 points for the MSCI China Index

JP Morgan published a research report indicating that at the end of November last year, it upgraded the rating of Chinese stocks to "Overweight" in its allocation in the Asian market. At that time, it believed that multiple positive factors had driven a greater confidence that the four-year down cycle had ended, and the relatively underperforming position of Chinese stocks in the region in the second half of 2025 also created a more attractive entry opportunity. Currently, China is making progress in various areas such as AI applications, robotics, biotechnology, semiconductors, and fintech innovation, as well as support measures for consumption and real estate, local capital reallocation, increased shareholder returns, anti-involution, and easing deflation.

With the improvement of fundamentals this year, JP Morgan believes that investors' attitude towards the Chinese stock market will shift from opportunistic trading themes or sector rotation to long-term value appreciation. The current benchmark forecast for the end of this year is a target of 100 for the MSCI China Index and 5,200 for the CSI 300 Index, while the most bullish targets are 120 and 6,200 points, respectively.

JP Morgan pointed out that the market generally expects that the MSCI China Index companies can achieve a per-share earnings growth of between 12% and 15% in the next two years, with a more optimistic outlook for leading internet platforms benefiting from AI proliferation, commodity materials stocks, brokerage stocks, income-generating insurance stocks, consumer staples stocks, as well as sectors such as robotics, semiconductors, and biotechnology.

JP Morgan's key investment strategy list for Chinese stocks, all rated "Overweight":

Tencent Holdings (00700.HK)

Alibaba (09988.HK)

Kweichow Moutai (600519.SH)

CATL (300750.SZ)

China Life (02628.HK)

Zijin Mining (601899.SH)

NetEase - S (09999.HK)

LuoYang Molybdenum (603993.SH)

North Huachuang (002371.SZ)

Baidu Group (09888.HK)

Pop Mart (09992.HK)

MINIMAX (00100.HK)

Weichai Power (000338.SZ)

Zhongwei Company (688012.SH)

Futu Securities (FUTU.US)

Innovent Biologics (01801.HK)