Top China Tech Names for U.S. Investors Amid Massive Rally

It’s a good time to be investing in China tech. And, unlike U.S. tech in recent years, that has not always been the case.

The Hang Seng Tech Index, capturing the performance of the top tech listings in Hong Kong, is up 46.9% year to date. That’s far outperforming the Nasdaq Composite, up 15.5% in 2025.

You may recall back in February that I switched my strongest conviction of the year among Asian equities to Hong Kong-listed China tech plays. That call has been rewarded.

Strong September

Besides the April rally in stocks on both sides of the Pacific, the Hang Seng Tech’s showing is particularly strong this month. Since September 4, the tech index has marched 14.0% forward. It is looking like this week will be another strong one, giving it a win streak of eight consecutive weeks, the longest stretch since its inception in July 2020.

Chinese chipmakers have led the way. Hua Hong Semiconductor HHUSF (HK:1347) is the top performer on the tech index this year, up 228.0% as of Thursday, after hiring an Intel  (INTC)  veteran as president at the start of the year. Rival chip foundry SMIC (HK:0981) is up 164.8%. But SMIC withdrew its U.S. listing in 2019, and U.S. investors are barred from owning its shares.

U.S. investors will have more joy with the Hong Kong tech names that also have U.S. listings.

The next batch of strong performers this year is topped by JD Health JDHIY (HK:6618), the online clinic and pharmacy operated by e-commerce giant JD.com  (JD) . The online clinic is up 155.3% this year, although the parent has hardly budged, up just 3.9%.

JD’s rival Alibaba Group Holding  (BABA)  (HK:9988) is the polar opposite, with a whopping 111.6% advance this year. Its online health clinic and drug store Alibaba Health Information Technology ALBBY (HK:0241) is another top performer. Better known simply as Ali Health, its shares are up 102.2%.

Buying into BABA

I should note that I finally bought into Alibaba last week. With a purchase price of $163.30, I’m missing much of the rally this year, now that the stock has already doubled. But it remains far off its record high close of $310, set in October 2020 in the first post-COVID rally, and I believe there should be future upside for China’s largest e-commerce site.

That’s particularly true now that the company and figurehead co-founder Jack Ma have “come in from the cold” in the eyes of the Chinese Communist Party (CCP). The CCP is once again courting and encouraging Big Tech rather than trying to teach the tech sector a lesson about who’s really in charge.

Investors are recently rewarding Alibaba’s forays into artificial intelligence. The company in February indicated it would invest C¥380 billion into AI-related infrastructure in the next three years. Then, on Wednesday, it announced a partnership with Nvidia  (NVDA)  to build out its physical AI capabilities in areas such as data synthesis and model training. It is also ramping up data-center development around the world.

This should be a holding for the long term, an investment into a company that bar a couple of unusual quarters has been highly profitable, even while under political attack. BABA is performing better in 2025 than JD and grocery-store app operator Meituan MPNGY (HK:3690), which is down 32.1% this year, precisely because deep-pocketed BABA has been making great inroads into the “quick commerce” category that used to be Meituan’s forte. Alibaba has claimed market share out that is approaching that of Meituan as a result of a costly coupons-and-discounts price war.

Temu, Too

PDD Holdings  (PDD) , the operator of the app Temu, is one of the rare China tech plays that is only listed in the United States. Its expansion away from its small-town and rural group-buying roots into global e-commerce has been rewarded, despite ongoing tariff restrictions that disrupt its business model. Still, PDD shares are up 35.1%, and would benefit from any easing of U.S.-China tensions.

JD.com is likely to be a smart investment call right now. It is rallying 3.5% on Thursday, with reports that it, too, plans to ramp up spending into AI.

Among other noteworthy advancers worth watching for U.S. investors: smartphone maker turned electric car producer Xiaomi XIACY (HK:1810), up 74.9%; video game designer NetEase  (NTES)  (HK:9999), up 70.6%; search-engine operator Baidu  (BIDU)  (HK:9888), up 62.9%; and entertainment conglomerate Tencent Holdings  (TCEHY)  (HK:0700), China’s largest company by market capitalization, up 56.3%.

It is a characteristic of Chinese tech investment that one or two companies in a sector tend to outperform at the same time that rivals suffer. While Chinese electric vehicle makers are performing strongly, there’s significant differentiation amid a fierce price war at home in China. Xpeng  (XPEV)  (HK:9868), up 92.1% in 2025, and Nio  (NIO)  (HK:9866), up 65.3% this year, lead the pack, while market-share leader BYD BYDDY (HK:1211) is up 21.8%. I’m not convinced by Nio’s long-term prospects but stand by Xpeng and BYD to succeed.

Avoiding the Losers

To avoid picking losers like Meituan (at least so far this year), U.S. investors can consider investing into the KraneShares Hang Seng Tech Index ETF KTEC. That’s an ETF I have recommended before, and where I also bought a small position back in May. It’s up a solid 17.6% since I’ve held it, and the ETF as a whole is up a whopping 43.5% this year after a particularly strong start to 2025.

Mainland Chinese markets will be closed for a week from October 1, in honor of China’s national day on that date. They’re due to resume trade on October 9.

Hong Kong stocks will also be out of action on October 1, next Wednesday, and will break again on October 7, the day after the Mid-Autumn Festival.

At the time of publication, McMillan was long BABA, BYD, KTEC, NVDA and XPEV.