HONG KONG: China and Hong Kong shares fell on Thursday as tech and AI-related stocks slipped, while tariff concerns prompted investors to adopt a more defensive stance.
The Shanghai Composite index and the blue-chip CSI300 index both declined 0.4% at close. The Hang Seng Index weakened 0.6% in Hong Kong.
Tech shares led the losses in both onshore and offshore trading. The CSI AI Index dropped 2.5%, its biggest single-day decline in two weeks, while the Hang Seng Tech Index slipped 1.7%.
Chipmaker Semiconductor Manufacturing International Corporation slipped 3%, while Alibaba and Meituan retreated 2.5% and 2.3%, respectively, in Hong Kong.
However, the banking index climbed 0.6% and energy shares rallied 3.1%, helping limit declines.
Donald Trump threatened to escalate a global trade war with further tariffs on European Union goods on Wednesday, as major US trading partners said they would retaliate for trade barriers already erected by the US president.
“We recommend investors book profits on China’s tech sector and wait for greater clarity on US tariff policies before entering again,” analysts at UBS Global Wealth Management Chief Investment Office said in a note.
State-owned enterprises and high dividend-yielding sectors such as financial, utilities, and energy are still the place to go under tariff uncertainties, they added.
Around the region, MSCI’s Asia ex-Japan stock index was weaker by 0.67%, while Japan’s Nikkei index closed down 0.08%.
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