The import and export data in the first quarter of 2026 brought “unexpected joy” to the market.
Amid concerns about a global economic slowdown, China’s total import and export value increased by 15% year-on-year, which not only far exceeded expectations, but also directly ignited foreign investors’ enthusiasm for A-shares.
In the first quarter of 2026, the net inflow of northbound funds hit a record for the same period in history, and giants such as BlackRock and Bridgewater have increased their investment.
This seemingly simple linkage of two sets of data is actually a systematic revaluation of the value of Chinese assets by global capital amid complex changes.
From the perspective of foreign investment, foreign trade that exceeds expectations is of great significance.
It has restored confidence in China’s economic fundamentals through three clear paths.
First of all, it is the most direct signal of profit improvement.
The core engine of this round of growth is the “three new things” represented by integrated circuits, new energy vehicles, and energy storage equipment.
The explosion of exports of these high value-added products has directly driven orders and profits for A-share companies in the relevant industry chain.
For example, Hubei’s integrated circuit exports surged by 170.1% year-on-year in the first two months, and automobile exports increased by 99.6%.
When foreign investors saw that CATL’s overseas revenue accounted for more than 30% and Sungrow’s overseas business gross profit margin increased, what they saw was the restoration of profitability of each specific company.
Second, it marks a critical turning point in the economic cycle.
A more convincing signal is that the PPI (industrial producer price index) turned positive year-on-year after 41 months.
This is generally interpreted by the market as a clear sign that China’s industrial economy has emerged from the period of price downturn and that supply and demand relations have improved.
Huatai Securities research report pointed out that this change is crucial to reducing the risk premium of RMB assets.
At the same time, the export delivery value of industrial enterprises increased by 6.3% year-on-year from January to February, setting the highest growth rate in the past year.
This means that growth is switching from “policy support” to more sustainable “fundamentals-driven” growth.
Finally, it verifies the irreplaceability of “Made in China” in the global industrial chain.
Whether it is the booming exports of optical modules and transformers driven by global demand for AI computing power, or the hot sales of energy storage equipment in Europe under the energy transition, it shows that China’s supply chain has the ability to respond quickly and deliver powerfully to meet new global demands.
As Neuberger Berman Liu Song said, Chinese assets are serving as an indispensable “stabilizer” in the global industrial chain.
To which “safe zones” does foreign money flow?
Confidence translates into allocations of real money.
In the first quarter, foreign capital’s path to increase positions was highly focused, showing a clear logic of “focusing on ourselves and taking into account defense.”
The core main force is betting on the overseas competitiveness of “new productive forces”. The areas where foreign capital inflows are most concentrated are hard technology sectors that are deeply tied to high-prosperity exports, such as power equipment and new energy, communications and AI computing power, semiconductors and high-end manufacturing.
At the same time, foreign investors have also increased their holdings in high-dividend sectors such as coal, electricity, and home appliances to build a more balanced investment portfolio that can withstand storms.
From a global perspective, the logic of foreign investment in A-shares stems from a contrasting “scarcity” and revaluation of value.
From the perspective of growth, Chinese assets provide scarce “speed”; from the perspective of valuation, A-shares have outstanding “cost-effectiveness”; from the perspective of asset allocation, A-shares provide valuable “diversification” value.
The deeper logic lies in the cognitive reshaping of the “security premium”. China’s advantages in energy independence, industrial chain integrity, and policy independence are being repriced by global funds, giving Chinese assets a unique “security premium.”
Comprehensive judgment shows that foreign capital’s increase in A-share positions is not short-term speculation, but a long-term layout based on profound logical changes.
As long as China’s manufacturing industry continues to move upstream in the global value chain, and as long as the narrative of economic transformation and upgrading continues, foreign capital’s re-understanding and increase in Chinese assets may be a story that runs through the medium and long term.
