Global markets fall after tech sell-off and China slowdown — November 2025

Markets slide after tech sell-off and disappointing China data

Markets woke up jittery and, to be honest, stayed that way. A sharp tech sell-off combined with fresh evidence of slowing activity in parts of China sent investors rotating out of some of the market’s most crowded trades. The result: mixed macro signals, shorter leashes on growth exposures and renewed attention to policy chatter from the UK and the US.

What happened in major markets?

• UK: The FTSE 100 closed down about 1.1% (near 9,698). Big banks — Barclays, Lloyds and NatWest — led underperformance, sliding roughly 2.7%–3.6% as financials lagged.
• US: The S&P 500 started lower but eked out a flat finish; the Dow fell about 0.7%. The Nasdaq—home to many AI and semiconductor names—was particularly volatile: down as much as 1.8% before a late regroup.
• Europe: The Stoxx 600 opened lower (-0.9%); France’s CAC 40 and Germany’s DAX both lost ground amid risk-off flows.
• Asia-Pacific: Japan’s Nikkei slipped 1.8%, South Korea’s KOSPI plunged 2.6%, China’s CSI 300 fell about 0.7% and Hong Kong’s Hang Seng dropped roughly 0.9%.

Why tech led the sell-off

AI-related and semiconductor stocks were the main drivers. Nvidia — still central to the AI rally — fell about 3.6% after a high-profile sale of shares by a large holder (SoftBank). That, in turn, forced quants and momentum funds to reprice exposure. SK Hynix, Samsung Electronics and TSMC followed suit with notable declines.

From where I sit, this looked like a classic AI valuations correction: one big liquidity event (a large holder trimming) plus algorithmic trading amplification equals a rapid re-rating. It’s messy, and it reminds you how crowded some trades were.

Chinese data added to market anxiety

Arguably the more structural concern was China’s fixed-asset investment decline — shrinking 1.7% in the first 10 months of the year. That’s a record move and it matters. Lower investment today signals weaker demand for capital goods and raw materials tomorrow, which ripples through exporters and commodity-linked economies.

Investors understandably asked: if fixed-asset investment in China is slowing, what does that mean for commodity prices, electronics supply-chains and emerging market export demand? The short answer: fewer orders, slower trade — and the risk that hoped-for stimulus remains more talk than action.

Policy and macro cross-currents

It wasn’t just corporate balance sheets or data prints. Policy noise amplified the mood. In the UK, the pound weakened when Chancellor Rachel Reeves stepped back from planned income tax increases; long-dated gilts rallied as traders reassessed fiscal trajectories. That’s fiscal policy and gilt yields doing the tango — and it changes the yield curve backdrop overnight.

In the US, lingering uncertainty around the federal government shutdown — plus delayed releases of key inflation and payroll figures — made traders cautious about when and if the Federal Reserve will cut rates. Fed speakers have sounded more cautious lately, which lowered market odds of a December rate cut 2025. In plain terms: central bank policy uncertainty is feeding volatility.

Analyst perspectives and market implications

Deutsche Bank’s Jim Reid captured the week well: contrasting narratives — relief that the shutdown wound down versus renewed doubts about AI valuations and Fed policy — left the market swinging. Pricing for a December Fed cut fell sharply over the week.

Kyle Rodda at Capital.com noted Asia’s sell-off wasn’t as severe as the US’s, but the region still felt the sting of sluggish activity and fading hopes for strong stimulus from Beijing. In short: hopes for a quick China-driven rebound are dimmer than they were a month ago.

Key takeaways for investors

• Reassess exposure to high-valuation tech: If you’re heavy in AI and semiconductor names, consider rebalancing to manage portfolio concentration risk. Ask yourself: is this a valuation reset or a structural shift?
• Watch China policy responses: A 1.7% drop in China fixed-asset investment matters. Track official statements, targeted stimulus talk and credit/liquidity measures — they’ll tell you whether weakness becomes policy action.
• Prepare for policy-driven volatility: Fed commentary and UK fiscal decisions can flip market pricing quickly. Use stop-losses, diversify and keep liquidity buffers if you’re not ready to ride out sharp moves.
• Think beyond the headlines: Ask practical questions — should I sell tech stocks after a re-rating? Is Nvidia’s sell-off a buying opportunity? Both answers depend on time horizon, risk tolerance and whether you believe the AI thesis is intact.

Mini case study: What a sudden re-rating looks like

Picture a pension fund with 25% allocated to technology equities, many priced for rapid AI adoption. A partial stake sale by a strategic investor—followed by cautious Fed commentary—leads to a 6–10% drop in that sleeve within a week. The manager faces three tough choices: (a) sell to preserve liquidity (and lock in losses), (b) hold through the pain and hope for a recovery, or (c) reallocate into cheaper cyclicals.

Each route has visible trade-offs — liquidity risk, opportunity cost, timing risk — and each reveals how a rapid re-pricing forces concrete decisions. I’ve seen teams agonize over exactly this. Sometimes action is necessary; sometimes patience pays. There’s no comfortable easy button.

Trading and portfolio strategies to consider

People often ask: how do you protect a portfolio from policy-driven volatility? A few practical tactics that work in real markets:

• Trim concentrated positions gradually rather than in one go — that reduces execution risk and prevents signalling to the market.
• Use options to hedge downside risk selectively, especially where implied volatility is elevated after a sell-off.
• Rotate into sectors that tend to benefit when tech underperforms — think select financials, industrials or energy — but only when valuations and fundamentals support it.
• Keep an eye on macro linkages: a China fixed-asset investment decline often presages weaker commodity demand — so watch copper, iron ore and related exporters.

Further reading and sources

If you want to dig deeper, start with broad market coverage and official stats — and then zoom into specialist takes:

• FTSE market coverage - The Guardian
• Chinese economy updates - The Guardian
• Markets coverage - Reuters
• Financial Times - Markets

Final thoughts

Volatility after concentrated sector corrections and disappointing macro data is uncomfortable — but it’s also normal. Long-term investors should resist knee-jerk actions, while staying ready to act when price dislocations create opportunities. Prudence wins the day: review allocations, check liquidity needs, and make sure your risk exposures match your objectives. And yes, be ready to pivot if policy or data shift the landscape again — because they often do.