AP The sharp rebound in Chinese technology shares helped improve overall market sentiment and partially offset broader losses across mainland equity benchmarks.
Synopsis Chinese technology stocks rallied sharply on Friday, mirroring global markets.
Investors regained confidence as the artificial intelligence sell-off appeared to ease.
Policy support for innovation boosted sentiment, though major indexes faced steep monthly declines.
Factory activity unexpectedly slipped into contraction, reflecting weaker domestic demand.
Trade discussions continued as leaders prepare for a potential September meeting.
By Anupam Nagar, ETMarkets.com XPeers Geojit Financial Services Share Price SBFC Finance Share Price Religare Enterprises Share Price Mas Financial Services Share Price Fedbank Financial Services Share Price Jul 31, 2026, 11:30:00 AM IST Follow us Chinese technology stocks rallied sharply on Friday, mirroring gains on Wall Street and across Asian markets, as investors regained confidence that the recent global sell-off in artificial intelligence-related shares may be easing.
According to a Reuters report, optimism surrounding China's policy support for innovation also boosted sentiment, although the country's key benchmark indexes remained on track for steep monthly declines.ADVERTISEMENT The tech-heavy STAR50 index jumped 6% by the midday break, while the CHINEXT Composite Index, which tracks startup-focused companies, climbed 4.9%.
Broader markets also advanced, with the Shanghai Composite Index rising 0.8% and the blue-chip CSI 300 Index gaining 1.2%.Despite Friday's rebound, China's major equity benchmarks were still set to record their worst monthly performances in months, as per the report.
The Shanghai Composite remained down 6.4% for July, marking its steepest monthly decline since March, while the CSI 300 was lower by 7.5%, on course for its weakest monthly showing since October 2022.
Investor sentiment improved after China's top leadership pledged at a high-level meeting on Thursday to accelerate breakthroughs in frontier technologies and promote the development of future industries.
The commitment reinforced expectations that Beijing will continue backing strategic sectors such as artificial intelligence, advanced manufacturing, and high-tech innovation.
Analysts at BNP Paribas noted that although the latest leadership meeting offered few major surprises on stimulus for the struggling property sector or consumer demand, policymakers once again emphasized deepening reforms in capital market financing and investment.
The analysts said the renewed focus on strengthening market resilience and investor confidence suggests authorities remain committed to supporting equities amid recent market weakness.Technology shares in Hong Kong also benefited from the improved sentiment, with the Hang Seng Tech Index rising 0.7%, even as the broader Hang Seng Index edged down 0.1%.ADVERTISEMENT However, economic concerns continued to weigh on the broader outlook.
According to the report by Reuters, U.S.
Treasury Secretary Scott Bessent said American officials had reminded Chinese Vice Premier He Lifeng that Beijing is expected to fulfill its commitments on rare earth exports and agricultural products.
The discussions come as both countries prepare for a possible meeting between U.S.
President Donald Trump and Chinese President Xi Jinping in September.ADVERTISEMENT ADVERTISEMENT Impact on MarketsThe sharp rebound in Chinese technology shares helped improve overall market sentiment and partially offset broader losses across mainland equity benchmarks.
Continued policy support for high-tech industries could provide near-term momentum for AI and semiconductor-related stocks, though concerns over slowing economic growth, weak manufacturing activity, and ongoing trade uncertainties are likely to keep broader market volatility elevated.
