China?s stock market falls as trade tensions with the EU grow

China?s stock market ended lower on Thursday as investors worried about a possible rise in trade tensions between China and the European Union (EU). The Shanghai Composite fell 1.59% to close at 3,707.5, while the Shenzhen Component dropped 2.43% to 11,816.8. Both indices touched their lowest levels since July 2025.

Investor concerns increased as the EU considered new trade measures against Chinese products, including furniture and scooters. Germany is also expected to push for restrictions on chemicals, machinery and possibly pharmaceuticals, following last week?s agreement to limit Chinese car exports to Europe.

China has reportedly viewed the car export agreement as a one-time concession and warned that it could respond if the EU introduces further trade restrictions. These developments have added to uncertainty among investors and put pressure on Chinese stocks.

AI-related stocks were among the biggest losers during the session. Cambricon Technologies fell 3.43%, Hygon Information Technology dropped 3.79%, Zhongji Innolight declined 5.19%, Eoptolink Technology plunged 7.49%, and Victory Giant Technology lost 4.69%.

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