China's AI computing stocks rally at the open

China's stock market opened with a sharp rise, and the AI computing sector was the main beneficiary. Shares of cloud computing provider UCloud (优刻得) surged more than 15 percent, making it the top gainer in its category. Meili Cloud and Envicool, key players in computing infrastructure, also posted sizable gains. China's main indices reacted with cautious optimism: the Shanghai Composite rose 0.12 percent, the Shenzhen Component gained the same amount, and ChiNext, the index of young technology companies, added a more modest 0.3 percent.

The surge in computing stocks reflects a deep conviction among investors that infrastructure will remain the cornerstone of the AI ecosystem for years to come. Software companies and model developers draw analysts' attention with their algorithms, but cloud providers and data center operators sit, quite literally, at the base of the pyramid. The voracious appetite of global companies such as OpenAI, Meta* and Google for enormous computing capacity has created steady demand for servers, cooling systems and cloud hosting. China feels that demand especially keenly, thanks to domestic initiatives to build national AI services and a huge number of local startups that need capacity.

The rise in shares of providers like UCloud shows that AI speculation is becoming more tangible and tied to real business metrics. This is not a crowd of retail investors who heard the word "neural network" and rushed to buy any stock in sight. A colder logic is at work: consumption of computing resources is actually growing, customer bills are growing, revenue is growing. Envicool, which specializes in cooling systems for data centers, rose in price because cooling is a critical need for data centers running under heavy load. This is not a speculative conclusion but a direct consequence of the laws of physics and current economics.

However, growth in computing capacity contrasts with declines elsewhere. Media assets and aerospace companies are showing weakness, which points to a more selective approach among investors. China's stock market is gradually reorienting: money is leaving traditional industries and flowing into segments that investors see as strategic for the future. AI infrastructure clearly makes that list.

ChiNext's modest 0.3 percent gain may look disappointing next to the 15 percent jump in individual AI stocks, but it indicates concentrated interest. Not the entire high-tech sector is rising equally: some companies attract capital inflows, while others lose investor attention. This is a healthy sign for the market: selectivity points to fundamental analysis rather than blind speculation.

The rise in shares of computing capacity providers on the Chinese market is an indicator that AI is moving from a phase of pure hype into a phase of real economic activity. Investors are betting on physical infrastructure because it enables everything else. As long as demand for computing capacity keeps growing, and in the world of AI it is growing, these companies will stay on the market's radar.

*Meta has been designated an extremist organization and is banned in Russia.