Foreign investors' holdings of Chinese A-shares hit over 4 trillion yuan ($588 billion) in the first half of 2026 to set a new high, with some overseas institutions continuing to expand their allocations in Chinese science and tech companies, according to a report by state broadcaster China Central Television (CCTV) on Wednesday.

Among the foreign investors, South Korean investors have shown growing interests in Chinese assets, channeling investments through a number of exchange traded funds (ETFs), data from the Korea Securities Depository (KSD) showed.

Some ETFs tracking Chinese tech, AI supply chains, semiconductors and new energy listed in the South Korea stock market have drawn significant attention from South Korean investors.

In terms of individual stocks, South Korean funds have focused their investments on emerging sectors such as AI and advanced manufacturing. In the A-share market, Sany Heavy Industry topped the list of stocks bought by Korean investors in the first half of the year, with a net purchase of $9.99 million, according to a report by China Securities Journal on Wednesday.

In addition to South Korean investors, other foreign financial institutions and sovereign wealth funds have been actively expanding Chinese asset portfolios.

In the first six months, the A-share market rally has been partly boosted by rises across the whole artificial intelligence (AI) supply chain, ranging from computing power and optical modules to AI chips, as well as semiconductor equipment and materials, according to the CCTV report.

"The valuation of Chinese market remains attractive," Liang Dawei, general manager of the Wealth Solutions Department at Standard Chartered Bank (China), said in a note sent to the Global Times on Wednesday.

Against the backdrop of the global AI wave, Liang highlighted several key factors, including China's rapid progress in technological innovation aligned with AI development, as well as its successful transition to renewable energy, which has provided abundant and reliable power supplies to support energy-intensive data centers.

"All these factors will enable China to gain a significant competitive edge in the global AI race," Liang said.

Tian Yun, a Beijing-based veteran economist, told the Global Times on Wednesday that he believes the stability, certainty and strong innovation momentum of the Chinese economy have become key driving forces for foreign investors to increase allocating to Chinese assets.

"For foreign investors, it is not a question of whether to purchase, but instead on how to allocate the Chinese asset portfolio," he said, stressing that China has provided attractive investment opportunities across both AI large language models and the entire AI infrastructure supply chain.

Tian pointed out that for South Korean investors, whose domestic market is also riding a strong AI wave, it is natural to invest in China given the close geopolitical ties and significant industrial chain synergies.