SHANGHAI: Chinese and Hong Kong equities moved lower on Thursday, pressured by widespread losses in technology shares and growing geopolitical concerns after fresh military action in the Middle East dampened investor appetite for risk.
Market sentiment weakened after the United States carried out overnight strikes on multiple targets in Iran, while US President Donald Trump warned that further military action could follow if diplomatic efforts fail to secure peace.
By midday, China’s benchmark Shanghai Composite Index had fallen 0.7%, while the blue-chip CSI 300 Index declined 1.1%. In Hong Kong, the Hang Seng Index dropped 1.1%, reflecting broad-based weakness across regional markets.
Technology stocks led the decline. China’s tech-heavy STAR 50 Index lost 1.1%, while the ChiNext Index, which tracks growth-oriented companies in Shenzhen, fell 1.8%. Hong Kong-listed technology firms also came under pressure, with the sector shedding around 2%.
The sell-off mirrored losses across Asia, where MSCI’s Asia-Pacific Index excluding Japan slipped 1%. Taiwan’s benchmark shares and Japan’s Nikkei 225 also traded lower as investors reacted to heightened geopolitical uncertainty.
Despite the recent weakness, analysts at HSBC Qianhai Securities maintained a constructive outlook on artificial intelligence-related investments, noting that continued capital expenditure by major cloud service providers and resilient corporate earnings could support a recovery in AI hardware stocks. However, they recommended a more balanced investment approach between AI and non-AI sectors during the second half of the year.
Meanwhile, inflation concerns in the United States added another layer of caution. US consumer prices recorded their fastest annual increase in three years in May, driven largely by rising energy costs linked to the Middle East conflict. The data strengthened expectations that the Federal Reserve may keep interest rates elevated for an extended period, potentially through 2027.
Investors are also closely watching upcoming Chinese credit and lending figures for May, seeking further insight into the strength of the world’s second-largest economy after April’s unexpected contraction in new yuan loans raised concerns about slowing domestic demand.
Meet Nandini Shukla, a dedicated branding and marketing professional with over three years of experience in the industry. Known for her result-oriented and hard-working nature, Nandini specializes in enhancing brand aesthetics and formulating effective marketing strategies. Her passion lies in creating content and strategies that are not only visually appealing but also impactful, ensuring that each brand she works with leaves a memorable impression.
At technewsme.com, Nandini combines her keen eye for beauty with her expertise in marketing to offer unique perspectives and transformative solutions. She is committed to helping clients achieve their goals by blending form and function in every strategy she develops. Join her on this journey as she shares insights and tips to elevate your brand in the dynamic world of marketing.
