Chinese Stocks Drop As Manufacturing Growth Slows And Geopolitical Tensions Hit

Chinese stocks — including Alibaba Group Holding BABA, Baidu, Inc BIDU, and JD.com, Inc JD — are trading lower Thursday as they resumed trading after New Year's Day.

China's Caixin/S&P Global manufacturing purchasing managers' index for December fell to 50.5, below the analyst consensus of 51.7, CNBC cites a Reuters poll.

The index compared to 51.5 in November and 50.3 in October, reflecting a slowdown as exports weighed on demand amid intensifying geopolitical tensions with the West in the form of a semiconductor embargo from the U.S. along with concerns over possible tariffs as threatened by President-elect Donald Trump during his presidential campaigns, CNBC cites Wang Zhe of Caixin Insight Group.

Also Read: Alibaba Leverages Scale and Deep Pockets to Slash AI LLM Prices To Gain Market Share

The official PMI for December, released Tuesday, came in at 50.1, below consensus estimates.

The iShares China Large-Cap ETF FXI and KraneShares Trust KraneShares CSI China Internet ETF KWEB, which represent Chinese equities, traded lower Thursday despite President Xi Jinping's assurances of policies to support economic growth during his New Year address.

China will reportedly increase special treasury bond issuance to 3 trillion yuan ($411 billion) in 2025. That’s up from 1 trillion yuan in 2024, to counter potential U.S. tariffs on Chinese imports.

China plans to boost consumption through subsidy programs for trading in old cars or appliances and upgrading large-scale equipment.

The funds will support investments in railways, airports, electric vehicles, robotics, semiconductors, green energy, and state bank recapitalization.

At last check on Thursday:

• BABA stock is up 0.32% to $85.
• JD is down 0.3%.
• BIDU is down 1.21%.
• Nio Inc NIO is up 7.57%.
• Li Auto LI is up 3%
• XPEV is down 1.39%.

Also Read:

• Trump Administration to Challenge Social Media Censorship, Setting Stage for Conflict with EU Regulations

Image: Shutterstock