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…
This week, the Chinese stock market experienced significant turmoil as technology stocks suffered substantial losses. The CSI 300 Index, a key indicator of mainland Chinese equities, plummeted to its lowest level in over a year, while the Star Market 50, a technology-focused index, plummeted by 4.1 per cent. Analysts have highlighted concerns over stimulus measures, potential interest rate hikes, and changing sentiment towards AI-related investments as factors contributing to the downward trend.
In response to the market downturn, the People's Bank of China lowered the one-year pledged supplementary lending rate by 0.25 percentage points, from 1.75 per cent to 1.5 per cent. This move aimed to boost lending to projects aligned with national priorities. Additionally, the central bank introduced a mortgage interest subsidy program for first-time homebuyers, offering an annualized interest subsidy of 1 percentage point for up to five years on loans with principals of up to 1 million yuan.
Even as the stock market faced turbulence, Chinese government bonds gained favor among investors. Citi Research analysts recommended going long on China's 30-year sovereign bonds, forecasting that yields would decline towards 1.8 per cent. Meanwhile, China's 10-year bond yields dropped to a one-year low of 1.68 per cent. The yield on the benchmark 10-year US Treasury rose to a new high of 5.25 per cent, while the 30-year Treasury yield reached its highest level since 2004 at 5.56 per cent.
Looking ahead, projections for Chinese vehicle exports indicate a significant growth trajectory. The China Passenger Car Association, a government-backed industry group, forecasted that overseas sales of Chinese-made vehicles, encompassing passenger cars, buses, and lorries, would surpass 12 million units in 2026. This projection represents a 44 per cent increase from 2025's 8.3 million units and a 20 per cent boost over the previous estimate of 10 million vehicles.
Furthermore, China's research and development (R&D) spending reached an impressive 3.92 trillion yuan (US$584.8 billion) in 2025, constituting 2.8 per cent of the nation's gross domestic product. This marks the first time China's R&D expenditure surpassed the average among Organisation for Economic Cooperation and Development (OECD) members, which stood at 2.7 per cent for the year.
Written by urgent.news from SCMP Tech's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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