Under the epidemic, are Chinese technology stocks a safe haven?

For investors, a seemingly unlikely safe haven has emerged from the wave of stock selling triggered by the New Crown epidemic: China.

This year, the Shanghai and Shenzhen stock markets have fared better than most other major stock markets. The benchmark CSI 300 index for large-cap stocks in these two markets is up 0.5% this year, compared with the S & P 500's 7% decline over the same period. The background of this divergence is that the epidemic has infected more than 80,000 Chinese, caused nearly 3,000 deaths, and caused widespread business disruption.

Individual investors bet that the Chinese government will introduce stimulus measures, which may be the reason for the stronger stock market. China's stock market financing balance has increased by 10% this year, reaching about 1.1 trillion yuan ($ 158 billion), the highest level in four years.

But not all sectors perform well. Traditional economic stocks such as banks and insurance companies that dominate the Shanghai stock market have fallen 8% this year. Technology stocks are the real bright spot. The Shenzhen GEM index, which is dominated by technology stocks, has risen 21% this year.