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China Shares Mixed at Open as Investors Rotate Into Defensive Sectors

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Chinese shares opened mixed on Friday as investors shifted to more defensive plays amid volatility in the technology sector.

The Shanghai Composite Index, the main gauge of Chinese stocks, opened 0.1% lower to 3,896.49. The Shenzhen Component Index rose 0.3% to 14,152.78.

The sectoral flow of funds points to a risk-off stance among institutional investors. Strength was concentrated in undervalued defensive sectors, with the higher uptake in coal stocks indicating large-capital rotation into safe-haven assets.

Meanwhile, popular sectors saw substantial net selling by major funds as profit-taking accelerated.

As the interim earnings season reaches its peak, market attention is turning toward fundamental strength. Industry leaders with solid earnings track records and defensible technological moats are poised to lead the valuation recovery, while stocks that trade purely on speculative concepts and price momentum are likely to face a corrective repricing, China Securities Journal reported.

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