HONG KONG: China and Hong Kong stocks slid to close lower on Wednesday, tracking a broader selloff across Asian markets as escalating tensions in the Gulf curbed investor risk appetite.
At market close, the Shanghai Composite index was down 0.4 percent at 3,993.23 points. China’s blue-chip CSI300 index slipped 1.1 percent.
In Hong Kong, the benchmark Hang Seng Index was down 0.6 percent at 24,407.96. The Hang Seng Tech index dropped nearly 1 percent.
In one of the biggest exchanges in hostilities since a ceasefire in April, Iran’s Revolutionary Guards said they carried out attacks against a US base in Jordan and 21 other targets in the Gulf on Wednesday in retaliation for American strikes around the Strait of Hormuz.
Shares took a snub in Asia, with MSCI’s Asia ex-Japan stock index trading 2.3 percent lower and Japan’s Nikkei index down 1.9 percent.
Among the biggest losers onshore, the CSI AI Index dropped 2.2 percent and the satellite industry sector index lost 3.2 percent to pare some recent gains.
Chip shares defied the downtrend on Wednesday, with the CSI Semiconductor Index adding 1.6 percent. Defensive sectors also gained, with the CSI Banks Index up 1.6 percent and CSI Liquor Index up 1.1 percent.
On the data front, China’s producer prices rose for a third consecutive month in May to the highest since July 2022 as global AI-related demand provided a boost for some sectors.
Consumer prices remained elevated but came below the median Reuters forecast.
“In China, domestic demand remain anaemic. However, global AI investment is supporting external demand and emerging industries, mitigating the risk of a sharp economic slowdown,” analysts at KGI said.
Investors should utilize technological innovation themes as growth engines, anchored by stable financial sectors to navigate volatility and achieve resilient returns, the analysts said.
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