SHANGHAI: Mainland China and Hong Kong stocks edged lower on Tuesday, as investor sentiment was weighed down by fresh signs of Middle East tensions after US President Donald Trump urged Iranians to evacuate Tehran.
Israel and Iran attacked each other for a fifth straight day on Tuesday.
Trump left the Group of Seven summit in Canada a day early due to the situation in the Middle East, the White House said on Monday, prompting broad risk-off sentiment in global financial markets.
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“One thing that is clear is that the situation continues to be highly uncertain and risks of escalation should not be ignored,” Maybank analysts said in a note.
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“Safe havens should continue to be better bid and the US dollar should be better supported.”
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At the midday break, the Shanghai Composite index was 0.19% lower at 3,382.14 points, while the blue-chip CSI300 index was down 0.15% at 3,867.83 points.
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The start-up board ChiNext Composite index was weaker by 0.14% and Shanghai’s tech-focused STAR50 index fell 0.85%?.
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In Hong Kong, the benchmark Hang Seng Index was down 0.13% at 24,028.83 points, while the Hang Seng China Enterprises Index fell 0.23% to 8,710.33 points.
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Apart from the Middle East tensions, focus was also on the annual Lujiazui Forum this week, traders and analysts said.
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“The Lujiazui forum is likely to be the key window for financial and yuan internationalization-related policies, while the July Politburo economic meeting is likely to provide further guidance on the monetary and fiscal stance for H2 this year,” said Ju Wang, head of Greater China FX and rates strategy at BNP Paribas.
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Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.23% while Japan’s Nikkei index was up 0.54%.
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