Chinese stocks have closed lower for 10 straight weeks. That is the longest losing streak in the history of the country’s main benchmarks, according to Barchart data.
The selloff is hitting even as the economy grows 4.5%, a split that economists and investors are watching closely.
Why the Chinese Stock Selloff Keeps Deepening
A losing streak is a run of consecutive weekly declines in a market index. Bear-market territory generally begins when an index falls 20% or more from a recent peak.
The CSI 300 Index fell roughly 3.4% last week and is now about 17% below its June peak. The STAR 50 Index has dropped nearly 40% in the current half-year, a sharp reversal after an early-year rally.
The STAR 50 and ChiNext indexes have fallen more sharply than the broader CSI 300. That shows losses are concentrated in technology and chip names.
The selloff has been led by artificial-intelligence and semiconductor shares. Chipmakers MetaX and Moore Threads have each lost around half their value. Meanwhile, the hardware-focused ChiNext Index is down about 36%.
After a sharp early-year rally, investors have rotated out of the sector. Valuation concerns and a broader global stumble in the AI trade have added pressure.
State-backed funds have stepped in. Inflows into preferred exchange-traded funds surged last week to their highest level since July, according to Bloomberg. The increased activity suggests state-backed funds are trying to steady prices.
Is the Economy Really Booming While Stocks Fall?
Economist Steve Hanke of Johns Hopkins University says China’s economy is booming. Third-quarter growth reached a strong 4.5% YoY. He argues the economy’s momentum isn’t reflected in equity prices.
Official data from the National Bureau of Statistics showed GDP grew 4.5% from July to September. That beat the 4.4% consensus and accelerated from 4.3% in the second quarter.
Growth for the first nine months reached 4.6%, within Beijing’s 4.5% to 5% annual target range. Industrial output rose 5.5% in September, and exports stayed supportive, especially in technology goods. Hanke’s comment highlights a contrast between solid output and falling equity prices.
The divergence shows markets are looking past headline growth. Investors remain focused on the property-sector drag, soft domestic consumption, and doubts over whether AI-driven exports can offset broader weakness. So far, export strength in technology goods has not lifted the broader market.
Subscribe to our YouTube channel to watch leaders and journalists provide expert insights.
The GDP rebound eases near-term pressure for aggressive stimulus, yet the record losing streak suggests capital markets remain unconvinced. The next few weekly closes will show whether state-backed buying can halt the streak.
Until then, the gap between economic growth and equity prices remains the central puzzle.
