China Stocks Shed $2.4 Trillion as AI Doubts Rise — SkimNews
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- Chinese mainland stocks have lost about $2.4 trillion in market value since May as investors question AI profitability; analysts cite weak consumer spending, and the CSI 300 entered a bear market on October 22 after falling at least 20% from its peak.
- STAR 50 fell 40% in less than four months, erasing about $480 billion, and still trades at roughly 100 times earnings—down from nearly 250 at its peak but far above the Nasdaq 100’s roughly 30.
- Goldman Sachs puts AI companies at 42% of the market value of Chinese shares listed on the mainland and in Hong Kong and 57% of trading, so declines in AI stocks pull down the whole market.
- Unitree drew retail orders for 8,000 times the shares on offer when it listed in August, but its stock has since lost almost half its value despite a significant recovery this week.
- DeepSeek released a cheap and powerful chatbot in January 2025; Nvidia lost nearly $600 billion in market value in a single day, while Moonshot AI’s Kimi K3 sent chip stocks tumbling again in July.
- ByteDance and Alibaba were reportedly told by China’s internet regulator to stop buying Nvidia chips in September 2025, according to the Financial Times; Z.ai says it trained its GLM-5.2 model entirely on Huawei chips.
- Federal Communications Commission banned imports of new foreign-made humanoid robots in July on national security grounds; Washington is moving to ban Chinese-made optical parts from U.S. data centers, while Zhongji Innolight and Eoptolink are down about 60% from their peaks.
Why it matters: The key vulnerability is concentration: Goldman Sachs says AI companies account for 57% of trading and 42% of market value across mainland- and Hong Kong-listed Chinese shares. That leaves Chinese tech and chip investors bearing the consequences of the STAR 50’s 40% plunge even as its valuation fell from nearly 250 to about 100 times earnings.
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