Why is ChatGPT Benefiting Chinese AI stocks?

ChatGPT mania in the U.S. is having a direct benefit on Chinese artificial intelligence stocks. In case you haven’t heard of it, ChatGPT is an artificial intelligence model that interacts with you in a casual, conversational way. It generates articles, essays, jokes, poetry, and even Dungeons and Dragons campaigns based on prompts and is called the fastest-growing consumer app in history.

Is China using ChatGPT? No. So why are such A.I. companies as Hanwang Technology, TRS Information Technology, and Cloudwalk Technology rising? The CSI AI Industry is up about 17% this year, outperforming the benchmark CSI300 Index’s 6% rise.

These companies won’t likely push a ChatGPT-like product, with the potential exception of Baidu’s plans to test its “Ernie bot” soon.

Shares of Hanwang Technology, which makes products that enable intelligent interactions, jumped 10% on Tuesday, boosting prices by more than 60% in February so far. And the company is expecting an annual loss.

What’s going on? It has to do with where China stands on A.I. technology—which, for the past several years, has been in front of the U.S. Is most of this based on hype? Yes. However, their A.I. acumen will be an important factor in the future A.I. wars.