China's technological innovation capabilities are increasingly attracting the attention of global capital. According to Wind data, since the beginning of 2026, foreign institutions have conducted research on 189 A-share listed companies, with a clear focus on hard technology sectors such as power equipment, electronics, and machinery. Some foreign institutions believe that China's vast technology sector, along with domestic demand, innovation, and high-tech investment, will be key drivers of China's economic growth in 2026.
Intensive research activity is evident. Wind data shows that from the start of 2026 until February 14, a total of 189 A-share listed companies were researched by foreign institutions, with a concentration in the technology sector. Specifically, the most popular companies for foreign research this year include Huaming Equipment, Insta360, Inovance Technology, and Opt, each attracting research visits from over 50 foreign institutions. Orbbec secured research from 48 foreign institutions, while YHDF was researched by 39.
For instance, Huaming Equipment has been a standout, recently researched by 59 foreign institutions including Morgan Asset Management and BlackRock. The focus of the research was the development of the company's domestic and international power grid businesses. Huaming Equipment stated that its products are now used in over a hundred countries and regions globally, serving transformer manufacturers of all sizes. Additionally, the company announced on February 12 that it is planning an overseas issuance of shares (H-shares) for listing on the Hong Kong Stock Exchange.
Insta360 has also been a major focus for foreign investors, researched by 58 institutions this year, such as Point72 and Temasek. During research sessions, Insta360 mentioned that its current projects in development include a new generation of action cameras, a new all-in-one panoramic camera, wearable accessory cameras, and handheld portable Vlog cameras.
Inovance Technology has also drawn significant foreign interest, with 53 institutions, including Citadel, UBS, and Lazard, conducting research. The company expressed its goal to continuously increase the proportion of its overseas business and rapidly build an international platform encompassing sales, research and development, and supply chain.
Power equipment, electronics, and machinery industries are receiving high levels of international attention. In the power equipment sector, companies attracting concentrated research include Huaming Equipment, Inovance Technology, Wolong Electric Drive, Dajin Heavy Industry, Sieyuan Electric, and CSI Solar. In the electronics industry, companies like Insta360, Orbbec, Anji Technology, Smartsens Technology, China Resources Microelectronics, Huaqin Technology, VeriSilicon, and Jiemei Technology were each researched by over 10 foreign institutions. Within the machinery sector, stocks with high foreign interest include Opt, YHDF, Han's Laser, CSB Bearing, and Sona超声波.
Looking ahead, some foreign institutions believe that China's large technology sector, coupled with domestic demand, innovation, and high-tech investment, will be crucial for growth in 2026. Indrani De, Global Head of Investment Research at FTSE Russell, recently stated that for 2026, China will rely on domestic demand, innovation, and high-tech investment as key growth drivers, supported by expansionary fiscal policy. China possesses a substantial technology sector, accounting for 27.1% of the FTSE China Index as of December 2025. If 2026 mirrors 2025, where global equity performance is driven by multiple thematic forces, Chinese stocks could benefit again due to their more diversified industry composition.
"Chinese stocks may benefit from emerging market fund inflows in the new year," Wang Zonghao, Head of China Equity Strategy Research at UBS Investment Bank, noted. "We track around 800 active overseas funds that include Chinese stocks in their benchmarks. Among these, 143 funds held no Chinese stocks by the end of 2025, slightly down from 145 at the end of the third quarter. If these funds reinstate China to their portfolios at benchmark weights, potential inflows could reach $16 billion. Reported increased foreign investor interest in emerging market equities this year would indirectly benefit Chinese stocks."
Wang also mentioned, "Our recent discussions with US and European investors show very low active positioning in consumer and healthcare stocks, with most investors cautious about automakers. We've observed significantly increased interest in the chemical industry, a potential beneficiary of anti-involution policies, and the A-share semiconductor capital equipment sector, which benefits from the domestic AI upcycle."
Miranda Li, Head of China and Hong Kong Equity Strategy Research at J.P. Morgan, believes that if anti-involution measures achieve substantial results, the A-share market could experience a 'slow bull' rally in 2026, potentially leading to a fundamental shift in investor confidence. Regarding sectors, Li is focused on property, materials, and information technology. She also suggested that stronger signs of stabilization in the property market, particularly further policy easing in first-tier cities, could provide positive surprises. "The incremental liquidity in this market cycle primarily comes from passive funds, which is distinctly different from past bull markets: the 2014-2015 cycle was mainly driven by leveraged funds, while the 2019-2021 cycle relied more on thematic/active fund inflows," Li added.
Nomura Orient International Securities analysis suggests that looking ahead to 2026, the start of the 15th Five-Year Plan is expected to drive investment and inject momentum into economic growth. Simultaneously, "anti-involution" policies are anticipated to improve profit margins in non-financial industries, though due to the lag in corporate profit recognition, the full effect of these improvements is more likely to be seen in 2027.