Chinese stocks slid deeper into a bear market as rescue efforts by state-backed funds fail to rebuild investor confidence.
The onshore benchmark CSI 300 Index fell as much as 1.6% on Friday, taking the week’s losses to nearly 5%, the most in three months. The decline comes after the gauge dropped 20% from its June high on Thursday, entering a bear market. It has fallen through a closely watched level of 4,000.
The selloff is testing Beijing’s ability to restore market confidence, with state buying doing little to stem the slide as momentum deteriorates and investors remain reluctant to step in on valuations alone. In Hong Kong, a gauge of Chinese technology shares is about 2.5% away from erasing all the gains since Beijing unveiled its stimulus blitz in September 2024.
Exchange-traded funds favoured by China’s so-called national team saw net inflows of 46 billion yuan ($6.89 billion) on Thursday, the most since the Liberation Day-spurred rout in April 2025, according to Bloomberg-compiled data.
While there are pockets of value after the selloff in China, “cheapness alone is not the catalyst,” Jade Fu, head of global multi-asset portfolio management for APAC at UBS Asset Management, said on Bloomberg TV. “We also need to asses growth, investor behaviour, momentum and I think these are quiet challenging right now.”
Also Read: Bonfiglioli Transmission IPO listing today: GMP at 11%; issue subscribed 46 times