Update | China’s tech start-up index hits two-year low while Shanghai sees worst close in 7 months
Xiongan-related stocks plummet in Shenzhen while Chinese insurers and banks outperform in Hong Kong
Chinese tech start-up stocks slid to their worst levels in more than two years on Wednesday while the benchmark Shanghai Composite Index retreated to a seven-month low as fears of an escalating crackdown on financial leverage continued to dampen investors’ risk appetite, especially for speculative plays.
The Shenzhen-based ChiNext Price Index, China’s equivalent of the Nasdaq stock exchange for new technology companies, initially rose in the morning, but then gave up all its gains and slid 1.7 per cent, or 31.17 points, to close at 1,771.32, the lowest level since February 2015.
The benchmark Shanghai Composite Index, which is dominated by state-owned enterprises such as banks and energy firms, also wiped out early gains in the afternoon to end 0.9 per cent lower at 3,052.78, the worst close since October last year.
The Shanghai Composite has fallen in six of the past seven sessions.
Combined turnover for Shanghai and Shenzhen markets increased 16 per cent to 402.4 billion yuan (US$58.3 billion).
“Since the start of May, A shares have continued falling and repeatedly hit new lows. The risk sentiment is very weak,” said Su Peihai, an analyst for Guangzheng Hang Seng Securities.