On October 15, the Chinese stock market experienced a widespread decline as concerns over potential U.S. interest rate hikes weighed heavily on investor sentiment. The Shanghai Composite Index fell 1.59% to close at 3,707.48, while the Shenzhen Component Index dropped 2.43% to 11,816.79. The ChiNext Index also saw a significant decline, closing down 2.92% at 2,783.17.
Chinese financial media attributed the drop to a sharp decline in U.S. tech stocks, rising fears of interest rate hikes, and adjustments in AI-related stocks. The U.S. Consumer Price Index (CPI) for September rose 3.7% year-over-year, exceeding market expectations of 3.6%, which heightened concerns over interest rate increases. As a result, the Nasdaq Composite Index fell 1.88% the previous day, and the Philadelphia Semiconductor Index recorded its sixth consecutive decline. Analysts suggest that the significant drop in U.S. tech and semiconductor stocks contributed to the steep decline in the Chinese market. On this day, stocks related to AI hardware, including memory, optical communication, AI chips, and multilayer ceramic capacitors (MLCC), also showed weakness.
CITIC Securities stated, "There is no need to view the index adjustment too pessimistically," adding that while short-term investor sentiment has worsened, the valuations of some indices, such as the ChiNext, have fallen below reasonable levels due to ongoing adjustments, indicating a potential for valuation recovery in the future.
Among notable stocks, the baijiu sector showed strength. Huangtai Jiuye reached its daily limit, and Jinzhongzi Jiu also recorded significant gains. Reports of a general decline in inventory levels across baijiu distribution networks contributed positively to this sector. Some liquor retailers reported inventory reductions of approximately 10-20% compared to the same period last year. Major products from well-known baijiu brands maintained relatively high turnover rates, with some retail outlets managing inventory levels equivalent to one to two months' supply.
Additionally, stocks related to printed circuit boards (PCBs) rose. Jinlu Electronics and Aohong Electronics hit their daily limit. Jinlu Electronics announced that its cumulative net profit for the third quarter is expected to increase by 192.88% to 218.92% compared to the previous year, which served as a positive catalyst. Huatai Securities noted, "While the AI sector is under pressure from valuation burdens, sectors with solid cash flow are performing well," predicting further gains for PCB-related stocks.
Meanwhile, the People's Bank of China set the yuan's central parity rate against the dollar at 6.7253 yuan, a slight increase of 0.0004 yuan from the previous day, reflecting a 0.01% decline in the yuan's value.
* This article has been translated by AI.
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