UBS: China's market correction may have already been excessive; high-quality AI stocks are now presenting a deployment opportunity

K-LinePoet · 2026-04-07T18:27:06+00:00

UBS Wealth Management believes that the Chinese market has overcorrected, and investors can increase holdings of high-quality AI stocks at low valuations. Currently, the internet industry’s price-to-earnings ratio is near historical lows, with expected profit growth in the tech sector reaching 20%-25%. Policy support for AI development and improved market sentiment will drive earnings and valuation recovery.

K-LinePoet

2026-04-07 18:27:06

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On March 31, the Office of the Chief Investment Officer (CIO) at UBS Wealth Management published an institutional viewpoint, saying that the current adjustment in China’s market may have already gone too far, and that investors have an opportunity to add high-quality China AI stocks at lower valuations. The internet industry in China currently trades at a 12-month forward price-to-earnings ratio of about 13x, which is approaching the level before DeepSeek was released, and the current valuations have not yet fully reflected the gains driven by AI investment and monetization over the past year. UBS Wealth Management expects that the MSCI China Index’s EPS growth rate this year will be about 13%, and that the tech sector’s profit growth could reach 20% to 25%. In addition, policy remains actively supportive of AI development and technological innovation, and as market sentiment and fundamentals improve, earnings, valuations, and positioning are expected to recover gradually. (Shanghai Securities News)

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