Chinese technology shares fall sharply as AI valuations come under pressure

Chinese AI- and semiconductor-related stocks have dropped substantially from recent highs, with reports citing investor concerns about valuations and risks to future fundraising. One report also describes state-backed funds buying into the market during the selloff.

• The STAR50 index, which includes technology and semiconductor companies, fell about 40% from its July high in less than four months; the broader CSI 300 dropped about 20% from its June peak.· 2 sources
• The reports put the loss in market value at roughly $480 billion. They describe concerns that company valuations had risen faster than profits, alongside possible restrictions on Chinese equipment used in data centres.· 2 sources
• Unitree Robotics shares lost about half their value after trading began, while MetaX and Moore Threads each fell about half from July, according to the detailed accounts.· 2 sources
• The STAR50’s price-to-earnings ratio was reported at about 100, down from nearly 250 at its peak; the comparable Nasdaq 100 figure was given as about 30.· 2 sources
• One report says state-backed investors bought 128.7 billion yuan ($19 billion) through nine exchange-traded funds last week. The detailed accounts also say the downturn may make it harder for technology firms to raise money or proceed with planned listings.· 2 sources