The Chinese stock market, which rose the previous day, fell on July 30, influenced by a decline in global tech stocks.
On this day, the Shanghai Composite Index closed down 0.62% at 3,804.69, the Shenzhen Component Index fell 2.73% to 13,285.80, and the ChiNext Index dropped 3.97% to 3,244.62.
Concerns in the market were heightened following earnings reports from major U.S. tech companies. While Microsoft maintained growth in its AI business, Meta reported a significant decline in free cash flow due to heavy AI investments. This has led to skepticism about the slow revenue generation from increasing AI investments.
As the global semiconductor and AI sectors showed overall weakness, Chinese stocks related to these industries also struggled. Notably, companies involved in optical modules, AI servers, semiconductor equipment, and GPU supply chains experienced significant declines.
Additionally, the stock of Zhongji Xuchuang, a leading Chinese optical module company listed in Hong Kong, negatively impacted the Chinese market, dropping nearly 10% on its first trading day. Investors appeared fatigued with AI-related stocks, citing high valuations and concerns over short-term performance as reasons for not purchasing Zhongji Xuchuang shares.
CITIC Securities noted in a report that while the U.S. Federal Reserve held interest rates steady on July 29, it left the door open for future rate hikes. There are expectations that the Fed may raise rates twice by the first quarter of next year, but it is anticipated that rates will remain unchanged for the rest of this year.
Bank stocks were a highlight of the day, with Industrial and Commercial Bank of China and China Construction Bank rising to record highs. The cash dividends from the 41 listed banks reached 645.6 billion yuan, an increase of approximately 13.5 billion yuan from the previous year. This marks the third consecutive year that bank cash dividends have hit record highs.
The white liquor sector also saw gains, with Jinhuiju and Shede Liquor reaching their daily price limits. Huatai Securities reported that the fund's holdings in the white liquor sector have fallen to their lowest level since 2012, indicating an ongoing oversold condition. The firm anticipates that the white liquor sector has already dropped to historical lows and is likely to recover soon.
Meanwhile, the People's Bank of China set the yuan's central parity rate against the dollar at 6.7892 yuan, a decrease of 0.0007 yuan from the previous trading day, reflecting a 0.01% increase in the yuan's value.
* This article has been translated by AI.
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