Mainland and Hong Kong stocks experienced a sharp decline in early trading on Friday, following a broader global tech sell-off due to concerns over tighter AI regulation and sector slowdown. The Hang Seng Index dropped 392 points or 1.58 percent, settling at 24,404, while the artificial intelligence index saw a 7 percent fall. Meanwhile, the China enterprises index and tech index each fell by 1.44 percent and 3.11 percent, respectively, closing at 8,248 and 4,025. On the mainland, the Shanghai Composite Index and CSI300 Index both opened significantly lower, down 77 points (2.11 percent) and 1.5 percent, respectively. The Shenzhen Component Index and ChiNext Index also saw substantial declines, starting at 11,044 (minus 3.72 percent) and 2,438 (six percent lower), respectively. Tech stocks took the brunt of the downturn, particularly standout board Star 50 and the AI index, which both initially fell by over five percent. However, losses were somewhat alleviated as trading progressed. In the United States, overnight market losses were exacerbated when the Nasdaq, heavily influenced by tech firms, recorded its most severe one-day drop since "Liberation Day" in April 2025, when former US President Donald Trump announced comprehensive tariffs. These declines are attributed to fears of increased scrutiny on AI following Democratic victories in the recent midterm elections.