MSCI China Index Down 15% YTD in 2026 as AI Flows Favor US, Taiwan, Korea

Chinese stocks, which rallied in 2025 on the back of AI advances, have stumbled in 2026. The MSCI China Index has fallen 15% year-to-date, making it the world's second-worst major market performer after Indonesia. Relative to the MSCI World Index, it sits at its lowest level since the immediate aftermath of the September 2001 attacks.