The Shanghai Composite Index fell 1.1% on Thursday to 3,912, its lowest level in more than three months, while the Shenzhen Component Index declined 1.6% to 14,548 amid a broad selloff in technology shares. The sector came under renewed pressure as investors reassessed the durability of the AI-fueled rally, with increasing doubts over whether strong earnings growth can continue to support stretched valuations.
Chinese technology and semiconductor stocks led the downturn, with notable losses in Cambricon Technologies (-4.5%), SMIC (-4.6%), Zhongji Innolight (-1.2%), Eoptolink Technology (-2.3%), and NAURA Technology (-4.1%).
Risk sentiment worsened further after data showed China’s GDP expanding at its slowest pace since the fourth quarter of 2022 and slipping below the government’s 2026 growth target range of 4.5%–5%. In response, the People’s Bank of China pledged stronger policy support in the second half of the year, signaling readiness to deploy tools such as reserve requirement ratio (RRR) cuts and reverse repos, while maintaining the seven-day reverse repo rate as its key policy benchmark.
