by JIANG Yiman
JPMorgan has turned more optimistic on China's equity market, setting a year-end 2026 target of 5,200 for the CSI 300 Index. The projection assumes listed companies will deliver 15% earnings growth next year, valuing the index at about 15.9 times the 2026 consensus EPS of 328 yuan.
The bank said in its 2026 outlook that the odds of a rebound next year are higher than the risk of another slump, noting that several new drivers are becoming supportive. It upgraded China A-shares to overweight, citing wider adoption of artificial intelligence and continued consumption-support measures.
JPMorgan sees four themes shaping the market in 2026. It expects "anti-involution" policies — designed to curb cut-throat competition and improve industry efficiency — to support higher margins and returns for major A-share companies. Consensus forecasts place the CSI 300's 2026 net margin at 12% and ROE at 11%, roughly mid-range among Asia-Pacific markets.
The bank also expects stronger global AI infrastructure spending to lift Chinese suppliers and domestic AI monetization plays. A more accommodative global policy backdrop—particularly looser fiscal and monetary settings in major economies—should support overseas demand, while a recovery in China's consumer market is likely to boost both value and luxury spending.
JPMorgan has identified potential beneficiaries in IT and healthcare, screened by market cap, liquidity and overseas revenue exposure. It expects market leadership to shift from value to growth stocks by early 2026.
Risks remain. Earnings expectations for Q4 2025 could still face downward revisions, especially in technology and healthcare, and geopolitical tensions continue to weigh on sentiment.
Global banks have grown more positive on Chinese assets this year, including Citi, Goldman Sachs, Morgan Stanley and UBS.
On Oct 22, Goldman Sachs strategist LIU Jinjin said a "slow-bull" trend was taking shape and projected that the MSCI China Index could climb 30% over the next two years on 12% earnings growth and 5–10% multiple expansion.
Earlier, HSBC's wealth arm reiterated its constructive view on A-shares, while Citi upgraded China stocks to overweight in March as it cut its U.S. equity rating to neutral.
