Direxion Daily FTSE China Bull 3X Shares, an exchange-traded fund that aims to deliver triple the daily returns of the FTSE China 50 Index, saw its price surge 5.08% intraday on Wednesday, outperforming the broader market. This rally was fueled by Wall Street's increasing bullishness on Chinese stocks, driven by China's remarkable progress in artificial intelligence (AI) technology.

Several prominent Wall Street firms, including Morgan Stanley, JPMorgan Chase & Co., UBS Group AG, and Goldman Sachs, have expressed optimism about the prospects of Chinese stocks, particularly in the AI and technology sectors. They believe that China's AI breakthroughs, exemplified by the groundbreaking DeepSeek model, have challenged previous assumptions about the country's technological capabilities and spurred a reassessment of its investability.

Wall Street strategists anticipate that the momentum fueled by China's AI advancements will continue, driven by factors such as global investors' light positioning in Chinese stocks, ample liquidity, and lower interest rates. Furthermore, they expect Chinese firms to benefit from policy support and potential efficiency improvements enabled by AI, which could translate into higher earnings and valuations, narrowing the gap with their U.S. counterparts.