(Jan 7): Goldman Sachs Group Inc projects Chinese stock benchmarks to post another year of growth, though at a slower pace than in 2025, with earnings supported by AI and policy measures.
The MSCI China Index is forecast to climb 20% to 100 by end-2026 from its 2025 close, while the CSI 300 Index is seen rising 12% to 5,200, strategists including Kinger Lau wrote in a note Wednesday.
“Our expected equity gains in 2026 are almost entirely earnings-driven,” they said. Profit growth will be “supported by AI, ‘Going Global,’ and anti-involution policy.”
China’s equity rally has carried strong momentum into the new year, and Goldman Sachs joins other major firms in maintaining a positive outlook despite hefty gains in 2025. The upgrade reflects confidence that earnings expansion, policy initiatives, and new growth drivers will keep investors engaged.
The CSI 300 has advanced 3.5% so far in 2026 to its highest level in four years. The MSCI China has gained about 3.6%, outperforming the S&P 500.
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Investor enthusiasm was evident in onshore turnover, which rose Tuesday to the most since mid-September. Outstanding loans taken out by investors to purchase stocks also hovered near record highs.
Mainland Chinese investors’ southbound buying of Hong Kong-listed shares is projected to reach US$200 billion ($256.2 billion) on a net basis, setting another record, the strategists said. Meanwhile, foreign investors are expected to pare back their underweight positions in Chinese equities, potentially driving US$10 billion of inflows.
The strategists also raised their forecast for corporate profit growth, expecting it to accelerate to 14% in 2026 and 2027 from 4% in 2025.
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Goldman Sachs has long been bullish on China, often defying market pessimism during the multi-year slump. A year ago, its strategists projected a roughly 20% gain for Chinese stocks in 2025.
In 2025, the MSCI China rose 28%, while CSI 300 climbed 18%.
Uploaded by Magessan Varatharaja
