ReutersReuters

China, HK stocks end lower on losses in tech shares

Refinitiv1 minuto di lettura

China and Hong Kong stocks ended lower on Tuesday, weighed by technology shares as investors locked in profits following a sharp rally in AI-related names and ahead of Chinese President Xi Jinping's speech on Wednesday.

** China's blue-chip CSI300 Index 3399300 declined 0.7%, while the Shanghai Composite Index 000001 lost 0.5%. Hong Kong benchmark Hang Seng HSI shed 0.5%.

** Tech shares have been a key driving force behind China's bull run this year, with tech-focused STAR50 index 0000688 jumping 34% so far.

** Despite the sharp gains, tech valuations remain relatively contained, said analysts at Dongxing Securities.

** "A moderate degree of bubble may be necessary to spur innovation, with China's focus on artificial intelligence as a core driver of industrial development seen as a clear strategic direction," they said.

** Meanwhile, China's outstanding margin financing touched a record high of 2.29 trillion yuan ($320.15 billion), surpassing the previous peak set a decade ago, as investors ramped up leveraged bets to chase the stock market rally.

** The start-up board ChiNext Composite Index 3399006 declined 2.8%. The index had advanced 15% over the past month.

** Shares of Chinese chip firm Cambricon Technologies 688256, which had doubled since the end of July, rose 2.2%.

** Tech majors in Hong Kong HHSTECH dipped 1.2%.

** While China is still catching up on software applications, optimism is rising thanks to a growing talent pool and rapidly evolving downstream AI models, panelists said at a UBS A-share conference on Monday.

** Investors are now focussed on the military parade on Wednesday, which President Xi is scheduled to address.

** The CSI Defense Index 3399973 fell 2.3%.

($1 = 7.1529 Chinese yuan renminbi)

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