morgan stanley is betting on a few chinese stocks such as technology and materials companies to ride out whats expected to be a period of high market volatility the investment firm prefers mainland china stocks to those listed offshore equity strategist laura wang said in an aug 15 report about the banks positioning in chinese equities in the third quarter mainland chinas csi 300 index has outperformed the msci china stock index by 20 percentage points since midnovember she said msci chinas top holdings are chinese stocks listed mostly in hong kong such as tencent and alibaba  wang noted how the msci china index is most sensitive to sectors affected by regulatory uncertainty and is experiencing its longest bear market in its 20year history she expects the property market slump  downward earnings revisions potential covid outbreaks and uncertainty around uschina tensions to likely keep market volatility elevated in the interim she said the firm recommends remaining overweight on materials companies we also like information technology which enjoys a continuous policy tailwind and utilities for defensiveness wang said for each of those three sectors cnbc selected the stock on the banks chinahong kong focus list with the greatest potential upside to undisclosed price targets as of aug 11 per morgan stanleys analysts all three are rated overweight by the investment bank technology glodon potential upside 598 glodon is a construction software company with products that include building design and cost estimation tools the company claimed net profit attributable to shareholders doubled last year to 661 million yuan 973 million the shenzhentraded shares are down by more than 10 over the last six months but have posted gains over the last three months materials ganfeng lithium potential upside 588 ganfeng lithium is a giant supplier of lithium for electric car batteries the company said its net profit attributable to shareholders soared by 410 last year to 523 billion yuan 77021 million however the stock plunged this year the companys hong konglisted shares are down by about 24 over the last three months ganfeng and glodon have both outperformed the msci china index since morgan stanley added them to their focus list according to the banks report utilities kunlun energy potential upside 473 kunlun energy focuses on natural gas processing and transport the company is controlled by stateowned china national petroleum corporation kunlun said its profit attributable to shareholders surged by nearly 280 to 2302 billion yuan last year the companys hong kongtraded shares are down by about 12 over the last three months cnbcs michael bloom contributed to this report