Sep 4, 2024 at 5:13 am GMT
HONG KONG/SHANGHAI(Reuters) -China stocks sank to seven-month lows on Wednesday, while Hong Kong shares dropped more than 1%, tracking declines in Asian markets as a sharp tech sell-off on Wall Street and a slump in oil prices hit sentiment.
Risk appetite was also curbed by China's slowdown in services sector activities and elevated trade frictions between China and Canada.
By the midday break, China's blue-chip CSI 300 .CSI300 lost 0.4%, touching the lowest level since early February. The Shanghai Composite Index . SSEC dipped 0.5%. Hong Kong's benchmark Hang Seng Index .HSI lost 1.1%.
Tech shares fell in both markets, after shares of artificial intelligence heavyweight Nvidia NVDA .O tumbled 9.5% on Tuesday in the U.S., hitting sentiment in the sector globally. U.S. stock benchmarks registered their biggest daily drop since early August..N
"Hong Kong is pretty weak so whenever we see a negative signal like that from the U.S., Hong Kong will be performing even worse," said Steven Leung, executive director of institutional sales at UOB Kay Hian.
Leung said unlike the correction in August, which was affected by the unwinding of the yen carry trade, the main driver of the market weakness this time was concerns over the strength of the U.S. economy.
"It's more scary, because it's not a technical reason, it's a more fundamental issue," he said.
Investors are also fretting over the health of China's economy, after a private survey released on Wednesday showed growth in China's services sector activity slowed in August despite the summer travel peak.
Energy shares in both Shanghai and Hong Kong led the declines, as oil prices extended Tuesday's slump on global growth fears and expectations the political dispute that has halted Libyan exports may be resolved.
An index tracking Hong Kong-listed energy shares .HSCIE slumped 4.4%, while China's CSI energy index .CSIEN dropped 1.9%.
Shares of oil giants CNOOC 0883.HK, 600938.SS and PetroChina 0857.HK 601857.SS slumped more than 5% in both markets.
China's CSI 5G Communication Index .CSI931079 was down 1.5%, while Hong Kong's tech index .HSTECH slipped 0.4%.
Bucking the trend, China's start-up board ChiNext Composite index .CNT was up 0.35%.
 Reporting by Summer Zhen in Hong Kong, Tom Westbrook in Singapore and Li Gu in Shanghai; Editing by Rashmi Aich and Jamie Freed 

Sumber : Reuters