Fidelity China Special Situations (LON:FCSS) has announced its monthly summary for September 2026.
Portfolio Manager Commentary
Chinese equities declined over the period as initial optimism around innovation-led growth faded amid uneven economic conditions. Exports and high-end manufacturing remained resilient, while domestic demand stayed subdued. More recently, authorities have stepped up support for the property sector, introducing reforms aimed at restoring homebuyer confidence and reducing delivery risks. Artificial intelligence (AI) remains a key long-term theme, supported by advances in domestic AI models, infrastructure and hardware demand, and real-world AI applications, although elevated expectations increase the risk of volatility. The long-term outlook for Chinese equities remains constructive, supported by attractive valuations and targeted policy measures to strengthen the economy and property sector.
At a stock level, ByteDance gained, supported by optimism around its AI strategy, strong revenue growth and improving sentiment towards TikTok’s US operations. Lenovo advanced on the strength of its AI server business. Conversely, HashKey Holdings detracted amid weaker sentiment towards digital assets. Elsewhere, not holding China Construction Bank, Industrial and Commercial Bank of China or Bank of China detracted from relative returns, as investors favoured the defensive characteristics of banking stocks amid heightened market volatility.
Over the year to 30 September 2026, the Trust’s NAV declined by 22.4%, underperforming the index, which fell 17.3%. The Trust’s share price declined by 20.8%.
Fidelity China Special Situations PLC (LON:FCSS), the UK’s largest China Investment Trust, capitalises on Fidelity’s extensive, locally-based analyst team to find attractive opportunities in a market too big to ignore.
