(Yicai) March 10 -- South Korean investors ramped up their trading in Chinese stocks last month, hitting a two-and-a-half-year high, fueled by a surge in tech companies, according to South Korea's central securities depository.

In February, South Korean investors traded USD782 million of shares listed in China's mainland bourses or Hong Kong, almost a threefold increase from January, hitting the highest level since August 2022. This far exceeded their transactions in European and Japanese stock markets during the same period, Securities Times reported today, citing the latest data from the Korea Securities Depository and Clearing Corporation.

This year, Chinese tech stocks have performed strongly, and some Chinese exchange-traded funds listed on the Korea Exchange have seen impressive gains, further attracting local investors. Experts predict the investment enthusiasm to continue.

From Feb. 17 to 28, six out of the top 10 most popular overseas stocks among South Korean investors were Chinese, concentrated on leading technology companies in electric vehicles, artificial intelligence, and chips, according to South Korea's largest securities company.

Haitong Securities noted in a research report that foreign capital, mainly short-term flexible capital, is returning to the recovering Chinese market. After the Chinese New Year that ended in early February, the outflow of foreign capital from Hong Kong stocks has narrowed and even turned into a net inflow at times, favoring tech stocks. Since Jan. 13, the SSE Science and Technology Innovation Board 50 Index has risen by more than 16 percent, and the Hang Seng Tech Index has jumped by 43 percent, significantly outperforming other major stock indexes.

Dan Ives, global head of tech research at Los Angeles-headquartered Wedbush Securities, said that investors are betting on the Chinese technology market, which is a wise move. Global investors are optimistic about the Chinese market due to the success in the field of artificial intelligence, he added.

Analysts said that against the backdrop of increasing global uncertainties, Chinese tech firms have continued to make innovative breakthroughs. South Korean investors expect China's government to continue unleashing economic stimulus policies and sustained support for the tech industry after the Two Sessions, a series of annual political gatherings that is likely to conclude this week.

Since January, foreign institutions such as Goldman Sachs Group and Morgan Stanley have expressed an optimistic outlook on China, driven by accelerating economic transformation and technological innovation, particularly breakthroughs in AI.

Editor: Emmi Laine