FX.co ★ China Stocks Rebound, Still Set for Weekly Decline

The Shanghai Composite rose 0.4% to 3,722 on Friday and the Shenzhen Component added 0.6% to 11,891, with both benchmarks rebounding from more than one-year lows hit in the previous session as investors paused following a prolonged selloff. Nonetheless, worries about a renewed flare-up in China–EU trade tensions lingered. The EU is considering new powers to restrict access to its single market and is scrutinizing import data for potential surges, a preliminary step toward imposing quotas on additional goods. Beijing has warned it will retaliate against any new EU trade measures or discriminatory restrictions targeting Chinese companies or products that go beyond the hybrid vehicle export cap agreed last week. AI-linked shares led Friday’s recovery as selling pressure eased, including Cambricon Technologies (up 1.4%), Hygon Information Technology (1.1%), Zhongji Innolight (2.2%), Eoptolink Technology (2.0%) and Victory Giant Technology (1.1%). Despite the day’s gains, both indices remained on course for a fourth straight weekly decline.