Chinese tech hardware shares tumbled as impressive quarterly results at some companies failed to offset persistent concerns over fundamentals and weak global AI sentiment. The chip-heavy STAR 50 Index dropped as much as 4.6% on Thursday after gaining 2.5% in the previous session.
Artificial intelligence chipmaker Moore Threads Technology Co. plunged as much as 13% even after sales surged nearly 1,800% on-year in the three months through September. Memory chip producer Biwin Storage Technology Co. slid 14% after a more than 500% jump in profit. The Chi Next gauge, similarly focused on hardware stocks, fell as much as 3.9%.
The STAR 50 has slumped nearly 20% so far this month, to the lowest since September 2025, amid worries over frothy valuations and intense domestic competition. Investor confidence remains fragile, with rebounds since the gauge peaked in late June proving to be short-lived. The selloff was part of broader weakness in global tech shares, as disappointing results from industry heavyweights renewed scrutiny of hefty AI spending. Samsung Electronics Co. fell more than 5% after its chip profit missed estimates, while Alphabet Inc. tumbled 10% in extended trading after weaker-than-expected sales.
"With little fundamental support, investors were treating the rebound as a short-term trading opportunity rather than a sustained recovery," said Fu Zhifeng, chief investment officer at Shanghai Chengzhou Investment Management. "Samsung and Alphabet's results miss are also among the factors weighing on tech sentiment."
Google supplier Zhongji Innolight Co. fell as much as 7.4%, while optical-component maker Suzhou TFC Communication Co. and printed circuit board manufacturer Victory Giant Technology also fell after a brief rebound on Wednesday. AI-related stocks remain expensive even after the recent selloff. The STAR 50 now trades at about 38 times forward earnings, compared with less than five times for South Korea's Kospi Index and 20 times for the Nasdaq 100.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing