China Stocks End on a Low Note Ahead of Mega IPO Debut in Shanghai

China's stock markets suffered a strong setback on Friday, following another wave in the global tech slump and amid signs some investors were selling Chinese mainland shares to raise funds to buy into the much-hyped US$8.6 billion Shanghai initial public offering by China's biggest memory chipmaker CXMT, which starts trading on Monday.

The benchmark Shanghai Composite Index retreated 1.6 percent on Friday, but wrapping up the week with a gain of 1.3 percent. The Shenzhen Component Index declined 2.5 percent on Friday but rose 0.5 percent for the week. The tech-focused ChiNext posted a weekly gain of 1.5 percent albeit losing 2.6 percent on Friday.

Hong Kong's Hang Seng Index ended the week with a rise of 1.6 percent after slipping almost 1 percent on Friday.

"The volatile performance indicates anxious investor sentiment, and there was frequent rotation in stocks among high-growth sectors including tech, power, non-ferrous metals and oil," said Dai Qing, an analyst with Changjiang Securities.

Tech shares remained the major market drag on Friday, with Zhongji Innolight, the world's largest producer of optical transceivers used in AI data centers, losing 2.4 percent in Shenzhen trading, while in Shanghai, chipmaker Cambricon lost 1.9 percent and Biwin Storage Technology plunged 5.6 percent.

Zhongji Innolight on Friday ended subscriptions a day early for its US$8 billion IPO in Hong Kong, the largest in the city in seven years. The share sale is reported to be heavily oversubscribed despite the company setting the highest subscription entry threshold in Hong Kong exchange history.

The market debut of ChangXin Memory Technologies (CXMT), the second-largest-ever IPO on the Chinese mainland, has generated speculation that the company may overtake Industrial and Commercial Bank of China as the Chinese mainland's most valuable company once it begins trading.

"More tech companies, especially those related to artificial intelligence, are about to get listed, which will make it easier for investors to judge the sector based on a larger pool," said Xong Wei, an analyst with UBS.

Elsewhere in Asia, Japan's Nikkei edged up 0.73 percent for the week, while South Korea's Kospi lost 1.9 percent after a 5.7-percent plunge on Friday led by chipmaking shares.

On Wall Street, the tech heavy Nasdaq on Friday dropped 0.6 percent, ending the week with a 1.2 percent loss as investors fretted over the escalating sums that tech heavyweights are saying they will spend on AI infrastructure. The broad S&P 500 closed relatively flat for a weekly drop of 0.6 percent. Global oil prices spiking above US$100 a barrel also dimmed investor confidence, as did comments from President Donald Trump that he is considering the largest all-out attack against Iran in the escalating conflict.