China shares slip as Middle East conflict, shipping disruptions persist

Chinese stocks closed lower on Friday, with Middle East tensions and unresolved shipping restrictions dampening sentiment.

The benchmark Shanghai Composite Index slipped 0.73 percent to 4,068.57 points, while the Shenzhen Component Index dropped 1.81 percent to 15,575.13 points. The ChiNext Index, tracking China's Nasdaq‑style growth board, lost 2.11 percent to finish at 4,037.95.

Timothy Pope, a China Global Television Network (CGTN) market analyst, recapped the day's market developments from Shanghai.

"Chinese mainland stock markets ended the week on a softer note. We saw the Shanghai Composite Index slip around three quarters of one percent. The Shenzhen component was down 1.8 percent. This looks like it's turning into a little bit of a pattern with softer Friday trade as investors take their profits. And this week there were some strong profits to take, especially on semiconductor shares. On Monday, we were talking about Huawei's new philosophy of chip design, which it is betting on to narrow the gap with world leading chip producers within the next few years. And that set off a really strong rally for China's chip makers who have links with Huawei. Hua Hong Semiconductor was one of the most visible gainers. It's China's second biggest chip producer, and while it was down 5.2 percent today, that was not enough to put much of a dent in its overall weekly gain of 32.3 percent," said Pope.

Pope noted investors are shifting into banking, pharmaceutical and consumer shares.

"Today, Cambricon Technologies, one of the recent market darlings of the AI boom, was down 5.8 percent. That decline means it's no longer China's most valuable stock, at least for the moment. The country's biggest chip maker, SMIC, was also a bit of a drag on the markets today. Instead, we saw investors rotating into banking stocks, some pharmaceutical shares and consumer staples like the liquor giant Kweichow Moutai. It rose almost 4 percent to be the top contributor to gains on the Shanghai index today. We are likely to see this volatility continue in the markets, at least in the short term, while there's still no resolution over the Middle East conflict and shipping, fuel and commodity supplies remain restricted," he said.

China shares slip as Middle East conflict, shipping disruptions persist

China's state-owned enterprises (SOEs) directly under the central government raised their basic research spending from 56.5 billion yuan (about 8.29 billion U.S. dollars) in 2021 to 102.4 billion yuan in 2025, with its share in total research and development investment climbing from 6 percent to 9.4 percent, according to the country's state-owned assets supervision authority.

During the 14th Five-Year Plan period (2021-2025), central SOEs undertook 1,783 national-level basic research projects with total funding of 35.3 billion yuan. Additionally, 34 central SOEs established joint funds with the National Natural Science Foundation totaling over 12 billion yuan, an official of the State-owned Assets Supervision and Administration Commission of the State Council said when introducing China's achievements in this regard.

To foster closer collaboration across industry, academia, and research, central SOEs have taken the lead in building 91 national key laboratories and 66 national defense science and technology key laboratories. They have also set up eight industrial common technology research institutes.

Furthermore, 25 central SOEs have collaborated with 10 national laboratories on 183 scientific research tasks, jointly establishing a number of collaborative R and D institutions in areas such as new power systems, artificial intelligence and quantum communication. Meanwhile, 58 of them have developed 97 hubs designated as sources of original technologies.

Looking ahead, Zhang Yuzhuo, head of the State-owned Assets Supervision and Administration Commission of the State Council, highlighted the strategic goals for the coming years.

"By 2030, China's central SOEs will establish a basic research system with clear positioning, a rational layout, and close integration of industry, academia, and research. Investment in basic research will double compared with 2025 levels, accounting for 15 percent of the total. We aim to build globally influential sources of original technologies in 10 fields, including new power systems, making central SOEs a vital force in China's basic research endeavors," Zhang said.

Chinese central SOEs' basic research investment tops 100 bln yuan in 2025