(Bloomberg) -- Emerging-market equities climbed to a three-month high as sentiment was bolstered by Chinese President Xi Jinping’s meeting with prominent entrepreneurs and DeepSeek’s AI model.
The MSCI emerging-market equities gauge jumped as much as 1.1% to 1,137.43 on Monday, the highest since November. Xi’s meeting fostered optimism that authorities may adopt a more business-friendly stance and added to the positive vibe fueled by a weaker dollar.
“The DeepSeek-driven rally appears to have further upside in the short term, supported by relatively low valuations, growing optimism that China’s tech innovation could surpass the U.S., and accelerating AI adoption and business opportunities,” said James Ooi, a Singapore-based market strategist at Tiger Brokers.
Tencent Holdings Ltd., which has the second-largest weighting in the MSCI EM index, announced that it is integrating DeepSeek’s AI model into WeChat. The firm joins a host of service providers and government agencies which are seeking to integrate the app across China.
China tech stocks “continue to deserve an overweight in Asian investors portfolios,” as DeepSeek has reignited investor focus on the technological prowess of these companies, Nomura Holdings Inc. strategists including Chetan Seth wrote in a Feb. 16 note. These “developments should further alleviate the discount on China stocks” relative to US tech shares, they added.
--With assistance from John Cheng.