China stocks slide as blue chips head for longest weekly losing streak

Shanghai stocks plunged on Friday, with the CSI300 index on track for its longest weekly losing streak ever, as Wall Street tech shares suffered heavy losses and domestic fiscal stimulus fell short of expectations, dampening investor confidence. By midday, the Shanghai composite index dropped 1.2%, while the blue-chip CSI300 index fell 0.5%, adding to Thursday's declines.

The CSI300 index, which had already hit its lowest close since July 2025, could extend its 11-week losing streak to a record if it maintains its losses. The index has dropped more than 20% since its June 22 peak, meeting bear market criteria. The smaller Shenzhen index shed 2.2%, ChiNext Composite fell 2.1%, and the tech-focused STAR50 index plummeted 3.1%.

Nasdaq suffered its biggest daily decline since early June on Thursday amid high-profile earnings reports fueling concerns over the AI spending race. Fears have been heightened by Beijing's fragmented stimulus efforts for a booming export-driven economy and a sluggish domestic market. Analysts at RBC Wealth Management attributed the slump to insufficient fiscal stimulus and disappointing earnings, suggesting that volatile trading could continue into early 2027 without new policy or technology catalysts.

Brief relief came after exchange-traded funds favored by state-backed investors experienced a surge in trading volumes early Friday, hinting at potential official market support. Hong Kong's Hang Seng index climbed 0.6% in early trade.