Chinese stocks and exchange-traded funds (ETFs) trading in the US markets experienced a significant selloff in overnight trading on October 14th, with the Direxion Daily FTSE China Bull 3X Shares (YINN) ETF plunging around 5% in pre-market trading.
The widespread declines affected various Chinese companies and sectors, with stocks like Bilibili, XPeng, JD.com, NIO, Baidu, and Alibaba all witnessing substantial drops ranging from 2% to over 4%. The reasons behind this negative sentiment surrounding Chinese equities are not entirely clear, but several factors may have contributed to the selloff.
One potential factor could be concerns over slowing economic growth and exports in China. Recent data showed that China's outbound shipments grew by just 2.4% year-on-year in September, missing expectations and marking the slowest pace since April. Weak export growth could reflect broader economic challenges and could negatively impact Chinese companies, particularly those heavily reliant on exports or global trade.
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