Chinese markets decline as technology stocks face regulatory concerns

The Shanghai Composite fell 1.10% to close at 3,649.2 on Friday, while the Shenzhen Component dropped 2.57% to 11,175.8. Both indices ended their two-day winning streak, tracking losses across Asian markets amid a sharp selloff in technology stocks.

Investor concerns over possible regulatory restrictions on the AI and data centre industries weighed on market sentiment. Fears that tighter regulations could affect funding for data infrastructure overshadowed earlier optimism about the possibility of faster efforts to end the Iran war following a Democratic sweep of the US Congress.

Technology stocks witnessed significant losses, with Eoptolink Technology and Zhongji Innolight falling 7.28% and 9.19%, respectively. Cambricon Technologies declined 4.98%, while Hygon Information Technology slipped 1.71%.

Despite Friday's decline, both indices ended the week on a positive note. The Shanghai Composite gained 1.39%, while the Shenzhen Component advanced 3.16%, with both benchmarks breaking their six-week losing streaks.

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