Chinese tech shares are starting 2026 strong, outperforming the Nasdaq. The onshore tech index is up nearly 13% this month, driven by AI, robotics, and flying cars. This rally is happening despite the broader economy still struggling with a housing slump. DeepSeek is expected to release a new R2 model this quarter, which is fueling interest. There are also upcoming IPOs for Xpeng's flying car unit and rocket maker LandSpace. Valuations are getting high though, with some AI chipmakers trading at 120x forward earnings. Regulators have started tightening margin financing to manage the speculation.