SHANGHAI: Chinese stocks ended on Wednesday at their lowest level in more than a year as a selloff in AI-related supply chain shares deepened and as investors digested mixed domestic inflation data.
The CSI300 Index closed 1.4 percent down, hitting its lowest level since August 2025 in late trade, while the Shanghai Composite Index fell 0.9 percent. Hong Kong’s benchmark Hang Seng edged down 0.1 percent.
Chinese producer prices rose at their fastest pace in more than four years in September, while consumer inflation came in below expectations. Pricier oil and commodities lifted factory-gate costs even as weak domestic demand kept broader price pressures contained.
Energy-related stocks rose as oil prices climbed on Saudi supply risk. The Coal Index was up 1.1 percent, while the CSI Energy Index climbed nearly 2 percent.
Consumer staple shares gained 0.3 percent.
Meanwhile, sentiment towards AI supply chain shares turned more negative in the afternoon session. The 5G Communication Index fell 3.8 percent. The tech-focused STAR50 Index was down 3.3 percent.
Zhongji Innolight, a leading maker of optical transceivers used in AI data centres, slumped 5.7 percent.
China’s stock benchmarks are near levels hit two years ago when a stimulus bonanza from Beijing lit up share prices and boosted hopes for a slow bull run, which is now limping into a three-month downtrend.
HSBC analysts cut their end-2026 targets for the Shanghai Composite, CSI300 and Shenzhen Composite indexes by 9 percent to 15 percent, to 4,100, 4,800 and 14,500 respectively, implying upside of 8 percent to 15 percent from current levels.
Value stocks have outperformed growth since July, but HSBC said the trend could prove temporary, citing growth stocks’ lower valuations and stronger earnings-revision momentum.
Tech majors in Hong Kong rebounded and were up 0.9 percent. Still, the index was hovering near a two-year low.