Pedestrians walk past the New York Stock Exchange (NYSE) in New York, the United States, Sept. 3, 2020. Photo: Xinhua

The US stock market's recent rout is in part linked to the Trump administration's escalating technology war with Beijing, a Chinese stock analyst said on Wednesday, after the NASDAQ officially entered correction territory, having lost more than 10 percent in the past three sessions and suffering its worst week since March.

Part of the reason for the wild sell-off on Tuesday was growing investors' concern that the China-US technology divide might continue to ferment as the US election draws near.

Market analysts are saying that the Trump administration's ban on supplies to Chinese smartphone maker Huawei could expand to other Chinese companies such as chip maker Semiconductor Manufacturing International Corp. 

This concern caused many US microchips makers to lead the tech rout on Tuesday as the Trump administration's rising export restrictions will continue to threaten market investors. Shares of KLA Corp, Lam Research Corp and Applied Materials Inc all closed down about 9 percent.

Prior to the news, Huawei said it would have to stop production of its Kirin chip after September 15 due to the ban order from  the US Commerce Department.

"Investors have a track record of reacting negatively to any new friction between China and the US, as evidenced by the stock market rout during the past several days," said Jack Ji, a senior partner with Anlan Capital. 

"It is especially the case given the current high valuations of US tech shares," Ji told the Global Times, noting that investors' risk aversion is high.

The six biggest tech stocks in the US market have lost more than $1 trillion over the past three days alone, with Apple dropping below the $2 trillion market cap threshold and electric vehicle maker Tesla posting its worst one-day loss on record with its shares falling 21.06 percent.

Many of the six largest tech companies, including Apple, Microsoft and Tesla, have significant business interests in China.

The market capitalization of those six companies stood at $5 trillion at the beginning of 2020, but it peaked at $8.2 trillion last week.

Affected by the US stock rout, Chinese stock markets closed down 1.86 percent on Wednesday, after paring some of their losses in morning trading after investors' panic eased.

The benchmark Shanghai Composite Index dropped 1.86 percent to 3,254.63 points at the close while the tech-heavy ChiNext index plunged 5.2 percent during intraday trading before closing with a loss of 4.8 percent as semiconductor and vaccine shares led the sell-off.

Even if there is massive sell-off in the Chinese stock market, there won't be a repeat of 2015, when a crash inflicted huge losses on highly leveraged investors, said Li Daxiao, chief economist at Shenzhen-based Yingda Securities.