Chinese tech, chip stocks slide as U.S. yields surge

On Thursday, Chinese and Hong Kong-listed technology stocks faced renewed selling pressure as rising global bond yields impacted high-valued growth shares and chipmakers. The Shanghai Shenzhen CSI 300 index in China fell nearly 1%, while Hong Kong's Hang Seng index declined 0.5% after a 1% drop the day before. This follow a significant surge in U.S. yields overnight.

The U.S. 10-year Treasury yield surpassed 5%, reaching its highest level since 2007, at around 5.12%, while the 2-year yield neared 4.9% and the 30-year yield rose above 5.4%. Higher yields increase the discount rate used to evaluate future corporate earnings, negatively affecting highly valued technology and AI-related stocks. In Hong Kong, Baidu (HK:9888) shares slipped 2%, while Tencent Holdings (HK:0700) saw a 1% decline.

Chip stocks also experienced a drop; Semiconductor Manufacturing International Corp (SMIC) (HK:0981) fell nearly 2%, and Hua Hong Semiconductor (HK:1347) shares decreased by 3.6%. Shenzhen-listed CXMT Corp (SS:688825) saw a more than 2% drop. Among AI-related stocks, Z.AI (Zhipu AI) (HK:2513) experienced a 1% decrease. U.S.-listed Chinese stocks continued to face pressure overnight, with Alibaba falling 4.7%, Baidu down 2.9%, and JD.com losing 0.8%.