Shanghai Composite Falls 0.82% on Oct 29, 2026 as Tech Selloff Deepens

Key takeaways

• The Shanghai Composite fell 30.04 points, or 0.82%, to 3,651.43 on Thursday, October 29, 2026, as a selloff in AI hardware and computing-power stocks deepened, according to Yahoo Finance data and PANews, citing Cailian Press.
• Tech-heavy boards took the brunt: the ChiNext index slumped 4.45% to 2,517.59 and the Shenzhen Component lost 2.92% to 11,138.20. The blue-chip CSI 300 fell 1.03% to 4,041.84.
• In Hong Kong, the Hang Seng Index reversed early gains and dropped 0.59% to 22,958.65, closing below 23,000, while the Hang Seng Tech Index fell 2.84% to 3,744.14, per Yahoo Finance and The Standard.
• The People's Bank of China (PBOC) set the yuan midpoint at 6.7147 per dollar, its strongest since February 2, 2023, but 551 pips weaker than a Reuters estimate, Reuters reported via Business Recorder.
• The US Federal Reserve held its policy rate at 3.75%–4.00% in a 10–2 vote, with two officials preferring a hike, according to the Fed's statement.
• In Southeast Asia, Indonesia's Jakarta Composite (IHSG) fell 3.49% to 5,098.06 on the same day, dragged by heavyweights including the big banks, CNBC Indonesia reported.

Session recap

Mainland Chinese stocks gave back most of Wednesday's rebound as investors sold the AI hardware names that had led the bounce, while Hong Kong slipped after a positive start. For the wider picture, see Asian and global markets today. On the previous session, covered in our October 28 China & Hong Kong brief, the Shanghai Composite had risen 0.91% and ChiNext 3.40%.

Changes are calculated from Wednesday's closes: Shanghai 3,681.47, Shenzhen 11,473.18, ChiNext 2,634.76, CSI 300 4,083.87, Hang Seng 23,094.83, Hang Seng Tech 3,853.72 and IHSG 5,282.31 (Yahoo Finance). CNBC Indonesia gave the IHSG decline as 184.26 points; the one-point difference comes from rounding. A lower midpoint means a stronger yuan fixing. A full-day Stock Connect southbound figure for October 29 was not available from a verifiable source at the time of writing.

The Shanghai Composite traded between 3,645.26 and 3,678.46, finishing near its low, according to Yahoo Finance. More than 4,700 stocks fell across the mainland market, and combined Shanghai and Shenzhen turnover was 1.56 trillion yuan, 72 billion yuan less than the previous session, PANews reported, citing Cailian Press. In Hong Kong, the Hang Seng moved between 22,928.27 and 23,184.09 (Yahoo Finance); The Standard said the index "reversed course" as the tech selloff quickened in the afternoon, and turnover was HK$189.5 billion.

What drove it

AI hardware stocks sold off again

The decline was concentrated in the companies that make the physical building blocks of AI data centres. Computing-power hardware names fell across the board: Eoptolink, Shijia Photons, Robotechnik, Biwin Storage and Changyingtong each dropped more than 10%, and T&S Communications touched its daily down-limit, PANews reported, citing Cailian Press. By the midday break the STAR50 index had tumbled 4.2% and the CSI 5G communications gauge had plunged 6.1%, Reuters reported via Business Recorder.

Robot maker Unitree, listed in Shanghai as Yushu Technology, slid 4.3% after its first earnings report since listing showed a fall in third-quarter net profit despite revenue rising 70% from a year earlier, the same Reuters report said. Asian shares more broadly gave up early gains as AI-related earnings drew mixed reactions, Reuters added. The move contrasted with Seoul, where chip stocks extended gains, as covered in our KOSPI report on Samsung's results.

James Wang, head of China strategy at UBS Investment Bank Research, said "valuations for the tech AI hardware names are now close to the historical trough," according to Reuters via Business Recorder. He added that UBS was "wary that investor sentiment on AI is fragile."

Banks cushioned the Shanghai index

The Shanghai Composite fell far less than ChiNext because it carries heavy weights in banks and state-owned firms. Banks bucked the trend: ICBC and China Construction Bank hit record highs again, and the combined market value of the four big state-owned banks topped 10 trillion yuan, PANews reported, citing Cailian Press. Food and beverage stocks also rebounded.

Hong Kong: chip and education stocks weighed

Chip stocks weakened throughout the Hong Kong session. Biren Technology fell more than 10% and Hua Hong Semiconductor more than 7%, while education group New Oriental dropped more than 14% after its earnings, TechFlow reported, citing Jin10.

Fed holds, yuan reaches four-year high

The Federal Reserve kept the federal funds target range at 3.75% to 4.00% on Wednesday and said "inflation remains elevated." Lisa D. Cook and Beth M. Hammack dissented in favour of a quarter-point hike, the Fed's statement showed. Reuters, via Business Recorder, reported that the Fed is delaying changes to borrowing costs until after next week's US midterm elections while it awaits more inflation data. Background: our explainer on the Fed's October meeting.

The onshore yuan touched 6.6620 per dollar, its strongest since June 7, 2022, and stood at 6.6621 at 02:35 GMT, Reuters reported via Business Recorder. The CFETS basket index, which measures the yuan against major trading partners, rose to 103.75, its highest since July 15, 2022, according to Reuters calculations. Maybank analysts said the PBOC "continues to allow the current direction of travel to continue, whilst reining in the pace of the USD/CNY decline."

Read-across for ASEAN investors

Indonesia's IHSG fell 3.49% on the same day, a much steeper drop than Shanghai's. CNBC Indonesia attributed the pressure mainly to heavyweight banks and blue chips (BBCA, ASII, BBRI, TLKM and BMRI) and listed the Fed decision, a 10-year US Treasury yield of 5.042%, energy prices tied to the Middle East conflict and rising Indonesian government bond yields among the factors weighing on sentiment. The outlet did not link the fall to China. For Jakarta's previous session, see our October 28 Indonesia brief. No direct link between Thursday's China selloff and Southeast Asian markets has been confirmed by the sources cited here.

Political & policy watch

• Fifth plenum: The Communist Party's Central Committee meeting, which opened on Monday, October 26, runs through Thursday, Reuters reported via Internazionale. President Xi Jinping briefed the meeting on a draft document centred on "full and rigorous party self-governance," the report said. No closing communiqué had been published by the end of Hong Kong trading on Thursday.
• Exchange-rate management: The 551-pip gap between the official fixing and the Reuters estimate was the largest weak-side gap since September 15, Reuters reported via Business Recorder. The fixing sets the centre of the yuan's 2% daily trading band.
• US politics and rates: The Fed's split vote and the timing of US midterm elections next week add uncertainty to the path of US rates, which Hong Kong's dollar peg ties closely to local borrowing costs.

What to watch next

• October 29–30: publication of the plenum's closing communiqué, if issued, for policy signals.
• October 31, 01:30 UTC: China's official October manufacturing and non-manufacturing PMIs (National Bureau of Statistics release calendar).
• Next week: US midterm elections, which Reuters linked to the Fed's timing on any rate change.
• November 9, 01:30 UTC: China's October CPI and PPI (National Bureau of Statistics).
• November 30, 01:30 UTC: China's November PMIs (National Bureau of Statistics).

Risk checklist for readers

• Sharp swings in tech boards. ChiNext rose 3.40% one day and fell 4.45% the next; tech-heavy indices can move several times more than the Shanghai Composite.
• Earnings abroad. Results from overseas chipmakers and US tech firms have repeatedly moved Chinese AI hardware stocks this week.
• Sector weights. Bank strength can mask broad weakness in the headline Shanghai index; check breadth figures such as the number of falling stocks.
• Policy events. The plenum communiqué and PMI data can shift sentiment quickly, and their content is not known in advance.
• Currency effects. The onshore yuan may trade up to 2% either side of the PBOC midpoint, which changes returns for overseas investors.
• Check final figures. Vendor data can differ slightly; exchange and index-provider releases are the reference for final values.

This article is for information only and is not investment advice.