From stock losses to bond bets: 5 figures investors are watching in China
A sell-off in technology stocks pushed mainland Chinese equities to their lowest level in more than a year, even as Beijing stepped up support for the economy with a key interest rate cut. At the same time, Chinese government bonds attracted fresh interest as US Treasury yields climbed to a new high. Here are some figures that have captured market attention this week. China’s CSI 300 Index hits…
China's stock market faced a significant downturn, with the CSI 300 Index reaching its lowest level in over a year, declining by 2.2 percent on Monday. The technology-focused Star Market 50 index also suffered heavy losses, plummeting by 4.1 percent. This downturn is attributed to a 31 percent plunge in the Star Market 50 during the third quarter, leading to a 12 percent decline in the CSI 300.
Analysts predict a challenging fourth quarter for mainland Chinese and Hong Kong stocks due to insufficient stimulus measures, concerns over further interest rate hikes, and shifting sentiment towards AI-related investments.
In an effort to boost the economy, Beijing reduced the one-year pledged supplementary lending rate by 0.25 percentage points, bringing it down to 1.5 percent. The central bank also introduced a mortgage interest subsidy program for first-time homebuyers, offering an annualized interest subsidy of 1 percentage point for up to five years, provided the loan principal does not exceed 1 million yuan (approximately US$149,000).
China's 30-year bonds have become an appealing investment option, with Citi Research analysts advising investors to go long on these bonds. They predict that yields on China's 30-year sovereign bonds will fall to around 1.8 percent, while the 10-year yield could decline to 1.6 percent. On Tuesday, the yield on China's 30-year special treasury bonds dropped to an intra-day low of 2.11 percent, and the 10-year yield plummeted to a one-year low of 1.68 percent.
Meanwhile, the yield on the benchmark 10-year US Treasury surged to 5.25 percent, while the 30-year Treasury yield reached its highest level since 2004, at 5.56 percent.
Looking ahead, the China Passenger Car Association forecasts that China's vehicle exports, including passenger cars, buses, and lorries, will exceed 12 million units in 2026, a 44 percent increase from the previous year's 8.3 million. This projection is 20 percent higher than the previous estimate of 10 million vehicles from the China Association of Automobile Manufacturers.
Furthermore, China's R&D spending has reached an all-time high, accounting for 2.8 percent of the country's gross domestic product in 2025. This expenditure surpasses the average among members of the Organisation for Economic Cooperation and Development (OECD), which stands at 2.7 percent.
Written by urgent.news from SCMP Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
