Goldman notes investors seek earnings-generating expansion by Chinese firms abroad

If Chinese firms successfully establish profitable international operations and deliver on earnings expectations, this could attract sustained institutional capital flows into Chinese equities and offshore-listed Chinese companies, particularly in sectors like EVs and tech where competitive advantages are defensible.

Continued weak domestic consumption paired with mixed international expansion results would likely keep Chinese equities range-bound, with investor attention rotating between domestic stimulus hopes and offshore growth narratives without a decisive shift in capital allocation.

If Chinese firms encounter significant trade barriers, geopolitical friction, or fail to achieve profitability abroad while domestic demand remains depressed, this could trigger a reassessment of Chinese growth narratives and pressure valuations of internationally-exposed Chinese companies and emerging-market exposure more broadly.