China & Hong Kong Stock Picks (January-February 2026)

Ed Dowd of Phinance Technologies has talked about his China’s 2026 Economic Outlook: Emerging economic crisis in 2026 on various podcasts including these short excerpts from a paywalled one:

🎬 This Chart Is One of Those OMG Moments When You Understand That China Isn’t Going to Overtake the US (The Solari Report | Catherine Austin Fitts) 5:06 Minutes (February 2026)

“China’s Real Economic Risks with Carlos Alegría and Ed Dowd”

This week, I am joined by Carlos Alegría (CEO) and Edward “Ed” Dowd (founding partner) of Phinance Technologies. As macroeconomic consultants, their core expertise is a high-integrity, data-driven focus on the underlying forces that tend to remain “invisible and neglected by most market participants.”

Phinance has just released a major report on China’s economic outlook for 2026, as well as a major report on the U.S. economic outlook. In this discussion, we take a serious look at the economic risks that China will be forced to confront in the coming year and beyond.

Our discussion focuses on three areas:

Demographics: In the aftermath of the One Child Policy, China’s population is shrinking—and that has significant economic implications.

GDP and Debt: Relative to the U.S., China’s GDP has declined. In 2025, China managed to achieve a 5% growth rate through strong exports, but to keep it going, they will need to continue to “export, export, export”—with ramifications for the economies being flooded with China’s cheap goods. China has also doubled its money supply.

Real Estate: China’s real estate problem is getting worse, not better. When the bubble bursts, Alegría and Dowd have serious concerns about a possible worldwide real estate contagion.

Both of my guests bring a wealth of credentials permitting a nuanced and informed discussion of China’s economic realities. Alegría, originally trained as a physicist before turning to quantitative finance, has dual PhDs in optoelectronics and finance. While working at a large London-based hedge fund at the onset of the 2008 Financial Crisis, he was shocked to realize that almost no one saw it coming. He is author of the 2017 book, Economic Cycles, Debt, and Demographics.

During the height of the Covid injection rollout, Dowd earned our deep appreciation for his powerful “Cause Unknown” book, his integrity, and his clarity in giving voice to the “died suddenly” phenomenon—and its economic implications. Before cofounding Phinance with Alegría, he had a lengthy career on Wall Street, including as a portfolio manager at BlackRock.

This is an interview that helps adjust the picture that most Western financial professionals have about China, by, as Alegría puts it on the Phinance website, “separating information (signal) from noise.”

For those who manage a family office, institutional assets, or family savings, and are likely affected by what happens in China and by the Trump administration’s trade policies, these Phinance reports offer valuable intelligence.

Full Report: https://solari.com/chinas-real-economic-risks-with-carlos-alegria-and-ed-dowd/

🎬 If You Want to Understand Geopolitics and Finance, Then You Need to Understand Demographics (The Solari Report | Catherine Austin Fitts) 2:30 Minutes (February 2026)

Here is Dowd’s take on China demographics along with a reply from former China insider Desmond Shum – the author of Red Roulette: An Insider’s Story of Wealth, Power, Corruption, and Vengeance in Today’s China and who’s billionaire (now ex-) wife Whitney Duan (Duan Weihong) “disappeared” for several years in a corruption crackdown:

I would say Chinese population loss will be way worse than any prediction out there. Last year, Chinese had less than 8 million new births. Name me a single study that came cross to that number. I would guess most are off by a decade.

The tsunami will hit harder and sooner than… https://t.co/J2USbMKXPZ
— Desmond Shum (@DesmondShum) February 17, 2026

You may or may not be surprised that Chinese officials are not much different than American etc politicians and this is causing a local debt spiral:

Inside China’s Local Debt Spiral

Underneath is a summary of a letter from a Chinese bureaucrat, laying out the local-government debt mess.

Every time I read something like this, I flash back to a dinner I had with Beijing’s executive deputy mayor around 2008.

He was about to… https://t.co/4uLyx871HV
— Desmond Shum (@DesmondShum) February 16, 2026

This is also an interesting observation about a USA vs. China military conflict:

I have heard Ed Dowd say in interviews that if you see the USA “pull back the legions” (like what the Romans did) as in closing overseas bases etc due to being overstretched, that’s a sign the dollar’s reserve currency status could be under threat.

However, it may very well be the Chinese who are now pulling back the legions:

💻 ‘Out Of Africa’: Beijing Slashes Investment Up To 85% (The Epoch Times via ZeroHedge) February 2026 🗃️

In some sectors, such as energy lending by Chinese development finance institutions, investment levels have fallen by as much as 85 percent from their peak years. That’s not a rounding error, that’s a strategic retreat.

What’s really going on? Is China walking away from Africa? Or is Africa revealing something deeper about China’s own economic stress?

It’s all of the above and more.

This tweet suggests that things in the hinterlands of China beyond where the tourists and western businessmen/media travel is not so good (keep in mind the same can be said about the USA/Europe etc):

I'm Chinese and I can only really say that:

> it really is a lot worse since covid

> for example, before covid you couldn't sell goods/wares on a stall in some touristy areas (not all ofc) because its ugly lol, but after covid you can since govt would rather have ppl doing… https://t.co/kmGPg1tp95 pic.twitter.com/ugzDvXLVpz
— katexbt.hl (@katexbt) February 17, 2026

Finally, this is also an interesting observation with the conclusion being that Europe is screwed as China and the USA carve up global industrial markets/demand:

The End of Europe’s Premium Middle

Europe isn’t merely “slowing.” It’s being structurally outscaled and outbid—squeezed between an America that owns the high-tech frontier and a China that has moved from low-end volume into the mid-tech industrial core Europe once dominated. The…
— Desmond Shum (@DesmondShum) February 10, 2026

Again, none of the above is to say there are NO opportunities to be found among Chinese and Hong Kong stocks in particular; but one must maintain a realistic viewpoint about China and understand the investment opportunities along with potential risks…

Stocks covered by a couple of equity research providers in this post:

[Note: On desktop browsers, an autogenerated table of contents will appear on the left side linked to each stock. I will add those links below after publishing/emailing this post…]

🇨🇳 February: BOE Varitronix, Trip.com, iQIYI, Unisound AI Technology Co Ltd, Foxconn Interconnect Technology (FIT Hon Teng), Yancoal Australia, Sany Heavy Equipment International Holdings, Hua Hong Semiconductor, Hesai Group, NetEase Cloud Music, China Telecom, NetEase, Beijing Geekplus Technology Co Ltd, Ke Holdings, OneRobotics (Shenzhen) Co Ltd, China Hongqiao Group, Shenzhen Xunce Technology Co Ltd, Bank of Communications, Anta Sports Products Ltd, Zhongji Innolight Co Ltd, Chuangxin Industries Holdings Ltd & CSPC Pharmaceutical Group

🇨🇳 January: Jiangsu Zenergy Battery Technologies Group, Sunny Optical, CR Land, Ping An Insurance, New Oriental Education, CR Beverage, Pharmaron Beijing Co Ltd, Xiaomi, Alibaba, Baidu, China Vanke Co Ltd, WuXi XDC Cayman, Postal Savings Bank of China Co Ltd, Bank of China, JD.com, Lenovo Group, J&T Global Express Ltd, Q Technology (Group) Company, China Resources Mixc Lifestyle Services, China Aviation Oil, XPeng, China Life Insurance & Greentown Service Group

Hong Kong stocks:

🇭🇰 February: Champion Real Estate Investment Trust, HSBC Holdings plc, Hang Lung Properties Ltd & Sino Land Co Ltd

🇭🇰 January: Hysan Development Company Limited, Fortune Real Estate Investment Trust, Sun Hung Kai Properties Ltd, Cathay Pacific Airways Ltd, BOC Hong Kong Holdings Ltd, China Overseas Land & Investment, DFI Retail Group, Wharf Holdings Ltd & AIA Group

CMB International Capital Corporation, a wholly owned subsidiary of China Merchants Bank (SHA: 600036 / HKG: 3968 / OTCMKTS: CIHKY / OTCMKTS: CIHHF), has a monthly list of 20+ high conviction stock ideas – namely Chinese stock picks (see our 2023 – May, June, July, August, September, October, November & December; 2024 – January-February, March, April, May, June, July-August, September, October, November & December; 2025 – January, February, March, April, May, June, July-August, September, October & November-December posts summarizing those) BUT these lists do not change too much from month to month. Stocks covered by the CMBI January list (including Additions and Deletions) plus February list (including Additions and Deletions) and included in this post with updated stats and charts include:

Geely Automobile Holdings, Jiangsu Zenergy Battery Technologies Group, Zhejiang Leapmotor Technology Co Ltd, J&T Global Express Ltd, Sany Heavy Equipment International Holdings, Bosideng International Holdings, Guoquan Food Shanghai Co Ltd, Luckin Coffee, Proya Cosmetics, CR Beverage, 3SBio Inc, Ping An Insurance, PICC Property and Casualty Co Ltd, AIA Group, FUTU Holdings, Tencent, Kuaishou Technology, Alibaba, Trip.com, China Resources Mixc Lifestyle Services, Greentown Service Group, Luxshare Precision Industry, Aac Technologies Holdings, BYD Electronic International Co Ltd, Zhongji Innolight Co Ltd, Shengyi Technology, BaTeLab Co Ltd, NAURA Technology Group, Datadog & Salesforce

DeepSeek can be tricky to use on anything about China (I ran the stock position of this post through and it produced an output; but note that most of the Hong Kong stock research are just updates without the titles giving away any real insights) – readers can decide whether these insights or summary about these stocks are accurate:

🤖 DeepSeek Analysis

Summary

And as always, this post is provided for informational purposes only (and to make your life easier…). It does not constitute investment advice and/or a recommendation…

🔬 Research analysis (including articles/blog posts from fund managers, etc.); 🎥 Video; 🎙️ Podcast; 🎬 Webinar; 📰 Newspaper/magazine article; 📯 Press release; 💻 Substack/blog/website article; ✅ Our own posts; 🗃️ Archived article; ⏰ Upcoming webinar or event; ⚠️ Disclosures or restricted access e.g. based on your location, investor status, etc.; 🇼 Wikipedia page; 🏷️ Tagged links to other posts about the stock.

China, Hong Kong & Macau Stock Index

Frontier & Emerging Market Stock Index

🇨🇳 China

February

BOE Varitronix

🔬 BOE Varitronix (710 HK) – 2025 preview: near-term earnings dragged by pricing pressure and new plant profitability (CMB International) 02-27 2026 ⚠️

🌐 BOE Varitronix (HKG: 0710 / FRA: VTX / OTCMKTS: VARXF) 🇧🇲 – Investment holding company. Designs, manufactures & sells liquid crystal display & related products. 🏷️
Price/Book (Current): 0.97
Forward P/E: 9.25 / Forward Annual Dividend Yield: 3.64% (Yahoo! Finance)

Trip.com

🔬 Trip.com (TCOM US) – Results beat; travel demand remains resilient (CMB International) 02-27 2026 ⚠️

🌐 Trip.com (NASDAQ: TCOM) – One-stop travel platform. Operates Ctrip, Qunar, Trip.com & Skyscanner. 🇼 🏷️
Price/Book (Current): 2.36
Forward P/E: 17.95 / Forward Annual Dividend Yield: 0.57% (Yahoo! Finance)

iQIYI

🔬 iQIYI (IQ US) – 4Q25 review: total revenue recovered on improving content performance (CMB International) 02-27 2026 ⚠️

🔬 iQIYI (IQ US) – 4Q25E preview: expect both revenue and earnings to recover in 4Q25 (CMB International) 01-22 2026 ⚠️

🇨🇳 iQIYI (NASDAQ: IQ) – Online entertainment video services in China. 🇼 🏷️
Price/Book (Current): 1.26
Forward P/E: 17.21 / Forward Annual Dividend Yield: N/A (Yahoo! Finance)

Unisound AI Technology Co Ltd

🔬 Company Report: Unisound (09678 HK): Fast Growing AI Solution Provider, Initiate With “Buy” (Guotai Junan International) $ 2026-02-27 ⚠️

🇨🇳 Unisound AI Technology Co Ltd (HKG: 9678) – Artificial intelligence products & solutions for daily life & healthcare related applications. 🇼 🏷️
Price/Book (Current): 2.51
Forward P/E: 15.97 / Forward Annual Dividend Yield: N/A (Yahoo! Finance)

Foxconn Interconnect Technology (FIT Hon Teng)

🔬 FIT Hon Teng (6088 HK) – Strong 2026 outlook with AI interconnect/ power/thermal upgrades as key growth drivers (CMB International) 02-26 2026 ⚠️

🌐 Foxconn Interconnect Technology (HKG: 6088 / FRA: 0FJ / OTCMKTS: FITGF) or FIT Hon Teng Limited – Precision components with offices & manufacturing sites in Asia, Americas & Europe. 🇼 🏷️
Price/Book (Current): 2.51
Forward P/E: 15.97 / Forward Annual Dividend Yield: N/A (Yahoo! Finance)