Chinese Stocks Decline for Second Session Amid Economic Concerns and Weak Government Support

Chinese stocks extended their losses for the second consecutive session during Tuesday's trading, amid escalating fears of an economic slowdown and the absence of strong political stimuli to support the markets.

The Shanghai Composite Index fell by 0.8% to drop below the 3,840-point level, while the Shenzhen Composite Index decreased by approximately 0.9% to reach 12,990 points, continuing the negative performance recorded in the previous session.

This decline followed the release of a series of weak economic data, which showed a slowdown in activity recently, with retail sales and industrial production recording levels below expectations, alongside a decline in fixed asset investment and a drop in new home prices, further pressuring market sentiment.

The technology stocks were also affected locally by global uncertainty regarding the sustainability of the investment wave in artificial intelligence, as prominent companies in the technology sector recorded significant losses, reflecting a weak risk appetite for this sector.

In contrast, the automotive sector showed notable positive performance, as shares of Changan Auto and BAIC Motor surged after regulatory approval for the first time to launch electric vehicles equipped with level-three autonomous driving capabilities, providing limited support to the market.

These movements reflect the ongoing caution in Chinese markets amid increasing internal economic pressures and a decline in momentum in some vital sectors, against a backdrop of a lack of clear signals for large-scale stimulus interventions at this time.