China stocks drop as tech selloff and US tariffs weigh on market
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Chinese equities continued their downward trajectory for the second consecutive session on Thursday, driven by a selloff in technology stocks and heightened trade tensions following new U.S. tariffs on aluminum and steel.
The Shanghai Composite Index declined by 0.39%, closing at 3,358.73, while the Shenzhen Component Index fell 0.99% to 10,736.19. The CSI Artificial Intelligence Index suffered the most significant drop in two weeks, losing 2.58% to 1,423.12, reflecting broader concerns over the tech sector’s outlook.
US Tariffs Escalate Trade Tensions
Adding to investor uncertainty, U.S. President Donald Trump announced an increase in tariffs on all aluminum and steel imports to 25%, further straining relations between the two economic superpowers. In response, Chinese Foreign Ministry Spokesperson Mao Ning vowed that Beijing would take “necessary measures” to protect its interests, condemning the tariffs as a “serious violation” of World Trade Organization (WTO) rules.
Beyond metals, broader trade tensions intensified after the Trump administration doubled tariffs on all Chinese imports to 20%, citing the fentanyl crisis as a justification for increased economic pressure. Chinese officials strongly rejected the claims, accusing Washington of spreading misinformation and shifting blame.
Corporate Performance and Market Movers
Lens Technology (300433): The stock closed 8% lower amid reports that the company plans to list shares on the Hong Kong Stock Exchange.
Baoshan Iron & Steel (600019): Shares gained 1% as investors anticipated the potential benefits of higher domestic steel demand.
Shennan Circuit (002916): The stock rose 1% following an impressive 34% increase in 2024 profits.
The combination of renewed trade disputes and ongoing sectoral pressures continues to fuel market volatility in China. Investors will closely monitor Beijing’s next policy moves and the global market’s reaction to further U.S. trade restrictions.
The Shanghai Composite Index declined by 0.39%, closing at 3,358.73, while the Shenzhen Component Index fell 0.99% to 10,736.19. The CSI Artificial Intelligence Index suffered the most significant drop in two weeks, losing 2.58% to 1,423.12, reflecting broader concerns over the tech sector’s outlook.
US Tariffs Escalate Trade Tensions
Adding to investor uncertainty, U.S. President Donald Trump announced an increase in tariffs on all aluminum and steel imports to 25%, further straining relations between the two economic superpowers. In response, Chinese Foreign Ministry Spokesperson Mao Ning vowed that Beijing would take “necessary measures” to protect its interests, condemning the tariffs as a “serious violation” of World Trade Organization (WTO) rules.
Beyond metals, broader trade tensions intensified after the Trump administration doubled tariffs on all Chinese imports to 20%, citing the fentanyl crisis as a justification for increased economic pressure. Chinese officials strongly rejected the claims, accusing Washington of spreading misinformation and shifting blame.
Corporate Performance and Market Movers
Lens Technology (300433): The stock closed 8% lower amid reports that the company plans to list shares on the Hong Kong Stock Exchange.
Baoshan Iron & Steel (600019): Shares gained 1% as investors anticipated the potential benefits of higher domestic steel demand.
Shennan Circuit (002916): The stock rose 1% following an impressive 34% increase in 2024 profits.
The combination of renewed trade disputes and ongoing sectoral pressures continues to fuel market volatility in China. Investors will closely monitor Beijing’s next policy moves and the global market’s reaction to further U.S. trade restrictions.