During Trump’s current term, European and Chinese tech firms are making a big comeback. After years of pressure from trade wars and strict regulations, they’re bouncing back. In 2025, both European and Chinese stocks are outperforming the S&P 500 (SPY), drawing fresh attention from investors.

Meanwhile, U.S. tech giants are losing their edge. The “Magnificent Seven stocks,” Alphabet (GOOGL), Amazon (AMZN), Apple (AAPL), Meta (META), Microsoft (MSFT), Nvidia (NVDA), and Tesla (TSLA), rallied after the 2024 election. But unfortunately, that rush is slowing down.

For example, let’s take Tesla. Its stock surged after Trump’s win, partly due to Elon Musk’s ties to the new administration. But since peaking in mid-December, the stock dropped over 27% year-to-date, reflecting the fading momentum of U.S. tech.

China’s Stocks Rise on AI Boom and Government Support

China’s stock market is heating up. The Invesco China Technology ETF (CQQQ) has returned 15.74% year-to-date, crushing the S&P 500’s 1.38% gain over the same period.

One major factor driving China’s gains is government stimulus. New measures aimed at boosting the economy are reviving investor confidence, especially in Chinese firms listed abroad. At the same time, fresh policies from China’s financial regulators are encouraging foreign investors to return.

Tech stocks in China are leading the charge. Companies like Alibaba (BABA) are benefiting from the country’s push into artificial intelligence. This momentum has lifted the Hang Seng Index by 38% over the past year and over 16% year-to-date. Meanwhile, Chinese electric vehicle (EV) makers are also on the rise. EV players such as BYD (BYDDF), Li Auto (LI), and XPeng (XPEV) are all seeing strong delivery numbers for February, reflecting a surge in consumer demand and renewed investor optimism.

Europe Stocks Gain as Investors Look for Value

Alongside Chinese stocks, European stocks are also quietly outpacing U.S. markets, and it’s easy to see why. Their lower valuations compared to U.S. tech giants are attracting investors looking for better returns. For instance, the MSCI Europe Index, which tracks major companies across 15 developed European countries, has climbed 6.84% year-to-date, reflecting this upward trend.

With U.S. tech losing steam, investors are looking abroad, and Europe and China are delivering where it counts.

5 Top Investment Picks According to Analysts:

Here are five Chinese and European stocks catching positive attention. Wall Street analysts have rated all of them as Strong Buys. Plus, each stock holds a Smart Score of eight or higher, suggesting they could outperform the market.

Alibaba: Alibaba, a Chinese e-commerce giant, has jumped about 56% in 2025, driven by AI advancements and stronger operations. The company’s December quarter results also impressed investors, with solid growth in its domestic e-commerce business and strong performance from its Cloud Intelligence unit.

• Rating: Strong Buy
• Target Price: $165.31, implying 24.75% upside potential
• Smart Score: “Perfect 10”

Li Auto: Li Auto, a Chinese electric vehicle manufacturer, continues to attract bullish views from most analysts. Recently, the company began mass production of its in-house developed SiC (silicon-carbide) modules, preparing for the launch of new BEVs later this year. The stock has climbed over 28% year-to-date.

• Rating: Strong Buy
• Target Price: $31.92, implying 3.87% upside potential
• Smart Score: “Perfect 10”

NetEase (NTES): This is a Chinese gaming and internet services company. NetEase reported better-than-expected Q4 2024 earnings recently. The stock is up 11.8% year-to-date due to strong performance in its online gaming segment, successful new game launches, and steady growth in its cloud and education services.

• Rating: Strong Buy
• Target Price: $115.83, implying 16.16% upside potential
• Smart Score: eight

NatWest Group (NWG): This is a banking and financial services organization headquartered in the United Kingdom. NWG stock has risen over 19% year-to-date, driven by strong financial performance, a favorable interest rate environment boosting profit margins, and positive analyst upgrades enhancing investor confidence.

• Rating: Strong Buy
• Target Price: 519.22p, implying 9.29% upside potential
• Smart Score: “Perfect 10”

Barclays (BARC): Barclays is a British multinational bank that offers retail, corporate, and investment banking services worldwide. The stock has risen over 18% year-to-date, driven by strong earnings, cost-cutting measures, and investor optimism about its restructuring plan.

• Rating: Strong Buy
• Target Price: 361.11p, implying 17% upside potential
• Smart Score: “Perfect 10”

Wall Street’s Take

Analysts are showing growing confidence in European and Chinese tech stocks as they outperform the S&P 500. Many believe that easing trade tensions and supportive government policies are boosting these markets. Meanwhile, concerns about valuation and regulatory pressure are weighing on U.S. tech giants.

Using the TipRanks Stock Comparison tool, let’s see how these five companies stack up against each other.

Disclosure