1. U.S. Markets Tumble as Dollar Surges
U.S. stocks faced significant pressure overnight, with major indices closing sharply lower. Tech-heavy Nasdaq plunged 2.78%, extending its five-day decline to 7.1% and breaking below key technical support levels. Meanwhile, the U.S. dollar surged 0.74%, raising concerns for global markets and currencies.
2. NVIDIA’s Earnings Disappointment Triggers Tech Selloff
NVIDIA emerged as a focal point of the selloff. Despite beating earnings expectations for Q4 FY2025, its quarterly profit growth fell short of lofty market hopes, causing shares to drop 8.48% and erase $274 billion (¥2 trillion RMB) in market value. Tesla, part of the “Magnificent Seven” tech giants, has now lost over 20% of its value in five sessions.
3. Global Markets Feel the Heat
The ripple effects spread to Asia-Pacific markets. Japan’s Nikkei 225 and South Korea’s KOSPI both fell over 3%, while Hong Kong’s Hang Seng Index dropped 2.5% and the Hang Seng Tech Index sank 4%. Notably, U.S.-listed Chinese stocks showed relative resilience, with the Nasdaq Golden Dragon China Index dipping just 0.81%.
4. A-Shares Face Short-Term Pressure
Mainland Chinese stocks opened lower on Thursday, with the Shanghai Composite down 0.88% and the Shenzhen Component falling 1.37% by midday. The tech-focused STAR Market and ChiNext declined 2.75% and 2.07%, respectively. Trading volume fell to ¥1.13 trillion, signaling cautious sentiment.
5. Market Breadth Weakens
Over 4,200 stocks declined across A-shares, with 1,397 down more than 3%. However, support from large-cap stocks helped limit broader index losses. Analysts note the selloff appears driven by global risk-off sentiment rather than fundamental issues in Chinese markets.
Outlook: A Turning Point for Chinese Tech?
While global tech faces turbulence, this could create opportunities for Chinese equities. Recent inflows into A-shares and Hong Kong stocks suggest some investors are reallocating from overheated U.S., Japanese, and Indian markets. If domestic large-caps stabilize, they may lead a broader recovery. Investors will watch closely to see if markets can repeat yesterday’s afternoon rebound.
Outstanding post but I was wondering if you could write a litte more on this subject? I’d be very thankful if you could elaborate a little bit more. Thank you!