China's tech companies are finally seeing the light of day in the stock markets after several challenging years. On Friday, Hong Kong's Hang Seng Tech Index closed 5.6% higher. The index is up 24% this year.

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A benchmark for Chinese technology stocks rose for a fifth straight week, hitting a three-year high, as companies in the sector continued to be buoyed by DeepSeek and relief over delayed U.S. tariffs.

The rise of Chinese AI startup DeepSeek has sparked a hunt for possible service and application beneficiaries from the country’s advancement in large language models, fueling a rally in cheaply-valued tech shares. The index currently trades at 17.4 times forward multiples, still below its five-year average of 24.5 times.

Chinese technology stocks have surged since DeepSeek R1s launch in late January, boosting investor confidence in Chinas AI sector. The AI model, which competes with OpenAIs ChatGPT using older hardware and a lower budget,

Apple sales have been struggling in China—iPhone revenue slumped 25% there in the fourth quarter—as the trade wars between the two biggest economies heated up.

Robust gains by Chinese tech stocks have added billions of dollars in their market capitalization, driven by the sudden rise to fame by homegrown AI app DeepSeek.

Investors in America’s biggest company are increasingly focused on China, where Apple Inc. is striving to win over a crucial customer base while also facing tariff-related risks.