China tech stocks rally on AI rebound hopes, but STAR 50 posts record monthly slump

Sing Tao News

31/07/2026 09:46

Updates to the close
SHANGHAI, July 31 (Reuters) - Chinese tech shares rallied on Friday, tracking gains on Wall Street and across Asia on hopes the global AI-driven sell-off was easing, though key indexes still posted hefty losses in July, with the tech-focused STAR 50 suffering its worst month on record.

** At the close, the STAR 50 index .STAR50 rose 3%, while the startup board CHINEXT composite index .CHINEXTC advanced 3.4%. But the STAR 50 plunged 25.9% in July.
** The benchmark Shanghai Composite index .SSEC edged up 0.7%, while the blue-chip CSI 300 index .CSI300 rose 0.9%.
** A rebound in tech shares helped offset the monthly losses in benchmark indexes, though SSEC remained down 6.4% this month to notch the biggest monthly drop since March, while CSI300 declined 7.9% and looked set for its worst monthly performance since July 2021.
** The sharp turnaround on Friday came after China's leaders pledged at a meeting on Thursday to make efforts to achieve breakthroughs in frontier technologies and promote the development of future industries.
** "While there was a lack of major surprises on stimulus measures for property and consumption, the July politburo meeting again highlighted 'deepening the comprehensive reform of capital market financing and investment' and a focus on 'bolstering the market resilience and investor confidence,'" analysts at BNP Paribas said in a note. 
** "Amid recent equity weakness, this appears to reflect policymakers' commitment to supporting the market," they said.
** In Hong Kong, the benchmark Hang Seng index .HSI inched up 0.1%, and the city's tech shares .HSTECH gained 0.5%.
** China's factory activity unexpectedly fell into contraction in July, pressured by shrinking new orders that reinforced concerns over slowing economic growth, weak demand at home and elevated production costs.
** U.S. officials told China's Vice Premier He Lifeng on Thursday that they expect Beijing to honor its commitments on rare earths and agricultural products, Treasury Secretary Scott Bessent said, as the two sides prepare for a possible September meeting between President Donald Trump and Chinese President Xi Jinping.

 (Reporting by Shanghai Newsroom; Editing by Ronojoy Mazumdar and Mrigank Dhaniwala)