Chinese stocks fell on Thursday, dragged down by a sharp selloff in chipmakers, while Hong Kong shares rebounded on a recovery in internet heavyweights.
** China's blue-chip CSI300 Index SZSE:399300 was down 1.9% by the lunch break, on track for their biggest single-day drop in a week. The Shanghai Composite Index SSE:000001 lost 0.9%.
** The tech-focused Star 50 Index SSE:000688 lost 4.6%, pulling back from a record-high hit in the previous session.
** The CSI Semiconductor Index (.CSI931865) also retreated from an all-time high, plunging 6.8% in its biggest one-day decline since October 2025. The index has surged 112% so far this year.
** Chipmaker Naura SZSE:002371 snapped a 10-day rally that had powered it to record highs, tumbling by the daily 10% trading limit. Peers including SMIC HKEX:981, Giga Device SSE:603986 and Hua Hong Semiconductor SSE:688347 declined 3.4% to 9.2%.
** "Technology stocks cooled sharply as markets underwent a period of rotation," analysts at Huatai Futures said in a note.
** "However, the shift is probably short-lived, with the current pullback offering a favourable entry point for medium- to long-term positioning," they added.
** The auto SSE:931008 and the banking indexes (.CSI399986) bucked broader weakness, adding 1% and 0.3%, respectively.
** Elsewhere in the onshore market, China Resources New Energy shares tripled in their listing debut after launching Asia's biggest IPO of 2026.
** In Hong Kong, the benchmark Hang Seng Index HSI:HSI was up 1.2% at 23,154.41. The Hang Seng Tech Index HSI:HSTECH added 0.6% to continue its recovery from a one-year low.
** Market heavyweight Alibaba NYSE:BABA added 2.7% and Tencent HKEX:700 climbed 2%.
** Looking ahead, investors are waiting to see whether China announces policy support for an uneven economic recovery at this month's Politburo meeting.
** "We continue to see only piecemeal consumer support, with July as the earliest window for an LPR cut," Citi said in a note.