After the "Seven Giants" in the US stock market, the "Eleven Knights" in the European stock market, and the "Seven Samurai" in the Japanese stock market, a new "label" is rising in the Global Capital Markets - China's "Ten Giants".

Jeff Weniger, the head of securities strategy at WisdomTree Investments, previously stated that $BABA-W (09988.HK)$ 、 $TENCENT (00700.HK)$ 、 $MEITUAN-W (03690.HK)$ 、 $XIAOMI-W (01810.HK)$ 、 $BYD COMPANY (01211.HK)$ 、 $JD-SW (09618.HK)$ 、 $NTES-S (09999.HK)$ 、 $BIDU-SW (09888.HK)$ 、 $GEELY AUTO (00175.HK)$ 、 $SMIC (00981.HK)$ Ranked among China's 'Ten Giants' and frankly stating that the 'Seven Giants' in the USA are giving way to China's 'Ten Giants'.

In terms of the rise in the first two months of this year, the Silicon Valley giants have performed mediocrely, but Chinese Stocks have been continuously rising.

Specifically looking at,

• China's 'Ten Giants'

In January-February 2025,$SMIC (00981.HK)$ cumulative increase of over 68%, $BABA-W (09988.HK)$ 、 $XIAOMI-W (01810.HK)$ with an average increase of over 50%, $BYD COMPANY (01211.HK)$ Increased by nearly 40%, $GEELY AUTO (00175.HK)$ 、 $JD-SW (09618.HK)$ Increased by over 18%, $TENCENT (00700.HK)$ Increased by nearly 15%, $NTES-S (09999.HK)$ Increased by nearly 20%, $MEITUAN-W (03690.HK)$ Increased by nearly 7%, but $BIDU-SW (09888.HK)$ Only increased by nearly 1%.

• The "Seven Giants" of the US stock market.

From January to February 2025, only $Meta Platforms (META.US)$ Increased by more than 14%, other companies recorded negative returns. $Amazon (AMZN.US)$ 、 $Apple (AAPL.US)$ 、 $Microsoft (MSFT.US)$ 、 $NVIDIA (NVDA.US)$ 、 $Alphabet-A (GOOGL.US)$ 、 $Tesla (TSLA.US)$ Fell by 3.24%, 3.32%, 5.63%, 6.98%, 10.05%, and 27.45% respectively.

According to Yicai, compared to the USA's technology giants with dynamic PE multiples around 30, the valuation advantage of China's Internet giants seems quite significant. Before this round of increases, the valuation multiples were less than 10, and now they are all around 15.

Morgan Stanley believes that it is still too early to draw conclusions, mainly because the quality of the median stock in the USA is relatively high, and the S&P 500 still provides the strongest EPS growth expectations among global peers. However, more institutions believe that there is still room for valuation repair in the Asian market, especially for China's Internet giants.

However, Futu News previously wrote an article."After the sharp decline in the US stock market, is there still a bubble among technology giants? There are still these events worth paying attention to in the future."It also mentioned that according to Bloomberg data, the dynamic PE ratios of technology giants including NVIDIA, Microsoft, Amazon, Alphabet, Broadcom, and Tesla have fallen below the average level of the past five years, while Apple's and Meta Platforms' dynamic PE ratios have also returned to near the average level of the past five years, perhaps now is the time to increase positions.

How will the market perform in the future?

Looking ahead, the 2025 National Two Sessions will soon be held, serving as an important window to observe China's economy, the focus of society is how to stimulate new momentum for high-quality development, which is also a barometer for investment in the Capital Markets.

Institutions generally believe that this year's Two Sessions can focus on three main directions: "boosting private enterprises," "promoting consumption," and "strengthening Technology." The policy line may focus on areas such as "service-oriented consumption" in people's livelihoods and new productive forces like "AI+" to guide capital towards improving livelihood and technological innovation.

In addition, Xingzheng Strategy believes that based on the split of Hong Kong stock custody institutions, southbound funds may be one of the main capital for the current bullish sentiment in Hong Kong stocks. According to estimates, foreign capital still has a potential increase of 1.41/0.24 trillion Hong Kong dollars in Hold Positions, while domestic public funds may still have an increment of over 70 billion.

Specifically, as of February 26, the market value of shares held by international intermediaries is 16.3 trillion Hong Kong dollars, accounting for 45.65% of the circulating market cap of Hong Kong stocks, which is at a relatively low percentile level of 11.1% since 2021. Xingzheng believes that

Comparing the market capitalization of holdings in February 2021 and January 2023, there may still be an enhancement space of 1.87/7.7 trillion HKD for foreign capital holdings market value. Comparing the proportion of market capitalization of holdings at the peak periods of 2023 and 2021, assuming there is no change in the market value of Hong Kong stocks, there may still be an enhancement space of 1.41/0.24 trillion HKD for foreign capital holdings scale.

As of Q4 2024, the public market's Hong Kong stock position is 11.5%, which still has some room for improvement compared to historical highs. XINGZHENG believes that,

As of Q4 2024, under a full position calculation, the active equity funds' investment value in Hong Kong stocks is 367.558 billion yuan, accounting for 11.5% of the total stocks investment value. If its Hong Kong stock position returns to the historical peak, based on the shareholding scale in Q4 2024, there could still be an incremental scale of over 70 billion.

Market participants point out that Hong Kong stocks currently exhibit a typical "volatile market" characteristic — policy support creates a safety net, but lacks continuous momentum. In this environment, a contrarian strategy of "buy on the disagreement, sell on the consensus" is more likely to capture excess returns. With the policies set during the Two Sessions and the quarterly report window approaching, the market may enter a new phase of fundamental verification.

Editor/Somer