Chinese stocks fell on Wednesday, with the Shanghai Composite slipping 1% to 3,953 and the Shenzhen Component dropping 2.2% to 14,301, as a broad selloff in semiconductor stocks dragged on both indexes. The pressure mirrored a wider retreat in chipmakers worldwide as government bond yields (returns on sovereign debt) climbed amid persistent inflation, elevated fiscal spending and heavy debt issuance. Geopolitical tensions added another layer of caution by raising worries about potential energy supply disruptions, reinforcing concerns that inflation and financing costs could remain high for longer. The weakness came despite strong results from GigaDevice, which posted H1 2026 revenue of RMB 11.57 billion, up 178.7% from a year earlier, while net profit attributable to shareholders jumped 1,091.5% to RMB 6.86 billion. Even so, investors continued rotating out of semiconductor names, with SMIC down 1.3%, Hygon Information Technology down 3%, GigaDevice down 1.6%, Hua Hong Semiconductor down 2%, Zhongji Innolight down 1.3% and Eoptolink Technology down 3.1%.