China's CSI 300 Sinks 8.5% in October as 12-Week Rout Grinds On

China's stock market can't find a floor. The CSI 300 finished October down 8.5% and has now lost 15% across 12 straight losing weeks — the longest streak on record for the blue-chip gauge. Fresh selling spilled into early November even after Beijing rolled out yet another rescue package.

The wreckage is heaviest in tech. The STAR 50, which tracks Shanghai's biggest technology listings, has shed roughly 40% since its late-June peak — about $480 billion in market value gone. On October 30 the pain went vertical: the CSI 5G communications index dropped 6.2%, the STAR 50 fell 5.5%, and optical module maker Eoptolink Technology plunged 14% in a single session.

The root cause is a global rethink on artificial intelligence. Investors are questioning whether the enormous spending on AI infrastructure, chips and computing capacity will ever earn back its cost, and whether the valuations baked into Chinese tech stocks earlier this year can hold up. That doubt has spread from semiconductors into communications equipment and beyond.

It isn't only about AI. Weak household consumption and a still-wounded property sector are sapping confidence in China's recovery, with reports that state-owned developer Zhuhai Huafa Group is seeking extensions on certain bank loans adding fresh debt jitters. Soft demand squeezes corporate revenue, while property stress drags on the wider economy.

Beijing has responded. The People's Bank of China unveiled another round of swap operations that could pump more than 100 billion yuan of liquidity into financial institutions for stock purchases, made its share-buyback relending programme permanent, and cut the attached interest rate from 1.25% to 1%. Regulators also pressed major and tech-heavy listed firms to buy back shares, told newly launched ETFs to build positions faster, and are weighing looser margin requirements.

Markets gave the measures a short-lived cheer: the Shanghai Composite climbed 1.1% on Monday, November 2, then reversed on Tuesday, November 3, with the CSI 300 and Shanghai Composite both down roughly 1% in early trade as tech and energy names kept bleeding. The next clues will come from AI earnings, consumer data and the property sector — and until those improve, the pressure looks set to stay.