Why 2026 is like 2020 for Asian equities

Asian equities are again showing a highly concentrated market, with AI-related winners driving much of the recent performance much like the momentum-led surge seen in 2020.

Some semiconductor and memory names look cheap on headline multiples, but those valuations may be tied to peak earnings that could prove difficult to sustain if demand cools or supply catches up.

At the same time, parts of China, Hong Kong and Southeast Asia still screen as distinctly inexpensive, with lower expectations already built into prices and stronger income yields supported by very low local interest rates.

For investors, the opportunity lies in separating genuinely undervalued franchises from stocks that only appear cheap because current profits are unusually strong.