In China, the AI bubble has already burst
Valuations had surged before worries over AI demand, export curbs and profit-taking erased gains across mainland technology shares.
- China's STAR50 index of AI and semiconductor leaders has plunged roughly 40% from its July peak, erasing $480 billion in market value as the technology-driven rally reversed sharply.
- Valuations skyrocketed to nearly 250 times trailing earnings before the correction, while traders cite high prices, tax bills, and potential U.S. bans on Chinese equipment in data centers as key drivers of the selloff.
- Shares in robot-maker Unitree have halved since its August debut, while chipmakers MetaX Integrated Circuits and Moore Threads Technology have also halved in value since July after surging 700% and 400% respectively at their market debuts.
- The market rout has pushed investors toward defensive assets, with Lotus Asset Management's Hong Hao warning the correction will "put a stop for many of the companies trying to get themselves listed." Equity fundraising by tech firms is likely to slow.
- China Securities Regulatory Commission Chairman Wu Qing met with market participants earlier this month to discuss oversight, while Beijing-based fund manager Dong Baozhen noted the market "evolved into a speculative crazy bull" before the inevitable collapse.
58 Articles
58 Articles
China’s AI Stock Craze Collapses In $480 Billion Market Plunge
China’s tech-heavy STAR50 index has collapsed, dropping 40% in under four months and wiping out roughly $480 billion in market value. The massive sell-off reflects growing anxiety among investors over slowing artificial intelligence demand, mounting price wars, and expanding U.S. export restrictions targeting Chinese tech infrastructure.Once driven by speculative retail enthusiasm, China's high-flying AI rally has unraveled far faster than Weste…
AI Bubble 'Bursting' in China's Stock Market, Tech Valuations Collapse Under Demand Concerns
A Shanghai fund manager warns that Chinese AI suppliers and chipmakers could eventually face intense price competition as a technology sell-off raises concerns about valuations and profitability.
Tech shares in particular have suffered significant losses on Wall Street in recent weeks. However, there is no mention of the bursting of an AI bubble. It is different in the Chinese stock market. Although the hype is even bigger there, the picture has clouded since the summer.
The overheating of the market in the PRC has been much stronger than in the US.
Unitree, MetaX and Moore Threats lose half of their value, while Chinese chip and data center components manufacturers fear a price war
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