Chinese Stocks Suffer Steepest Weekly Decline Since 2024

ChangXin Memory Technologies triggered a sharp sell-off in Chinese stock benchmarks after launching an $8.6 billion initial public offering. The CSI300 and Shanghai Composite indices both fell over 3% on Friday, marking the steepest weekly decline since December 2024 and wiping out the CSI300's annual gains.

Investors feared that the CXMT listing, combined with anticipated future IPOs from Unitree Robotics and Yangtze Memory Technologies Co., Ltd., would drain liquidity from the secondary market. Technology and AI stocks were hardest hit, while the STAR Market and Hong Kong's Hang Seng Index also experienced significant declines. These losses were intensified by high tech valuations and geopolitical tensions surrounding the conflict in Iran.

Market sentiment was further weighed down by President Xi Jinping, who opened the World Artificial Intelligence Conference in Shanghai with a speech prioritizing AI safety and governance over new investment initiatives. Although the state-backed China Securities Journal claimed that financial system liquidity remains ample, the markets continued to decline.