The Chinese stock market index CSI 300 lost 3.4% last week, its 10th consecutive weekly decline and its longest losing streak since the index’s creation in 2005, with AI leadership in the wrong direction.
Chipmakers and AI companies that powered Beijing’s spring rally are leading the sell-off. The country’s STAR 50 index — more than 30% of which is five AI companies — has lost 40% of its value since June 30.
At 10 uninterrupted weeks of losses, the streak has now topped the previous record of consecutive weekly losses set in January 2012.
From their peak values this year, the three most popular stock indices in China — Shanghai Composite, Shenzhen Component, and CSI 300 — have shed 12%, 28%, and 17%, respectively.
AI leads decline in Chinese stock indices
Exceeding all of those figures, an index of exclusively AI stocks has declined 35% since its peak this year.
Semiconductors, which experienced the biggest AI-fueled boom in the first half of the year, have busted the worst in the second half. China’s CSI All Share Semiconductors index has drawn down an incredible 45%.
Bloomberg correctly reported that no other major tech index in the world has fared worse than Star 50 since July 1.
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Foreign investors withdrew over $13 billion from mainland stocks via Hong Kong in the third quarter. It was the largest outflow in the past 12 months and reversed more than half of the inflows those equities enjoyed in the spring quarter.
The CSI 300 index is currently trading 30% below its February 2021 high.
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