SHANGHAI: Mainland China and Hong Kong shares closed lower on Tuesday, tracking weakness in regional peers as Federal Reserve interest rate-hike bets rose, while investors also monitored the Middle East for risks to a US-Iran interim peace deal.
The benchmark Shanghai Composite index eased 1.4 percent, while the blue-chip CSI300 index lost 2.8 percent.
The tech-focused STAR 50 fell 1.7 percent, while start-up board ChiNext Composite index plunged 3.8 percent.
Asian stocks mostly eased on the US rate-hike expectations, while oil prices continued to lose after the US waived sanctions on Iran.
US Treasury yields climbed with interest-rate-sensitive 2-year yields touching a 16-month high, as traders positioned for the prospect of the hikes later this year.
US dollar strengthened and pressured gold prices and non-ferrous metal shares, with a sub-index tracking the industry shedding 8.3 percent at the close.
“Weak headline macro data and regulatory scrutiny of technology firms continue to dominate the narrative,” said Wee Khoon Chong, APAC macro strategist at BNY.
“Yet the growth engine is clearly in high-tech industries … Investors should focus on where growth is occurring rather than where it is slowing,” he said, adding that a break above current SSEC levels would clear key long-term barriers and bolster the bullish case for Chinese equities.
In Hong Kong, the benchmark Hang Seng Index fell 1.8 percent and the city’s tech shares dropped 3.3 percent.
Weakness in tech shares plagued regional peers, such as South Korea, where benchmark KOSPI closed down 9.99 percent, as investors booked profits after recent sharp gains in chipmaker stocks.
Consumption in China, the world’s second-largest economy, remained subdued.
The mid-year “618” shopping festival, once a showcase for the country’s booming e-commerce sector, has drawn to a fanfare-free close as prolonged discounts and cautious households blunt the impact of one of the world’s largest retail events.