Barclays: The narrative of AI-driven growth will continue to deepen, optimistic about the performance of Chinese stocks next year.

Barclays research team recently released the quarterly report on the global economic outlook, believing that the narrative of AI-driven growth will continue to deepen by 2026, and this trend is irreversible. In terms of investment prospects, Barclays is optimistic about the performance of Chinese stocks. The institution stated that Chinese stocks performed quite well in 2025, with all major indices with high weights in Chinese stocks showing good trends, making the Hong Kong stock market one of the best-performing markets globally this year. Nevertheless, compared to other major markets, Chinese stocks still have relatively lower valuations. "China at the policy level has clearly stated strong support for the technology industry, with breakthroughs in emerging technology fields almost every week. In addition, Chinese households have a large amount of savings, which will provide strong support for the market." Barclays stated. The institution believes that Chinese households have always had a high savings tendency, with a large amount of savings previously deposited in low-interest rate deposits. In 2025, these savings began to gradually flow into A-shares. This fund inflow is expected to continue to drive the Chinese stock market higher in the coming months. Meanwhile, Barclays continues to be bullish on the performance of US tech stocks. This is mainly due to the continuous growth in capital expenditure driven by AI, as well as the steady double-digit growth in cloud services and digital advertising businesses. The recent pullback in some individual stocks is due to market skepticism, but as long as the US labor market does not significantly deteriorate, large tech stocks overall will still benefit from strong demand. "Although we expect some weakening in the US labor market, the likelihood of a sharp slowdown is low, and any signs of weakness could prompt the Federal Reserve to further cut interest rates, providing support for the stock market. Currently, demand for AI infrastructure remains higher than supply, so this is positive for chip manufacturers and component suppliers' stocks." Barclays said.