The Shanghai Composite fell 0.2% and the Shenzhen Component dropped 0.8% amid investor concerns over economic targets and trade tensions following US tariffs. UBS downgraded China’s technology sector, and several companies experienced significant losses.

The Shanghai Composite Index declined by 0.2%, dropping below the 3,370 level, while the Shenzhen Component experienced a greater loss of 0.8%, settling at 10,755. This marks the second consecutive session of losses, with investors expressing concerns over the absence of catalysts to boost market activity in China.

Analysts are increasingly worried about China’s potential to achieve its economic objectives as discussed in the recent Two Sessions annual meetings. The mood was further dampened by rising trade tensions following the implementation of US President Donald Trump’s tariffs on steel and aluminum.

Additionally, UBS adjusted its rating for China’s technology sector from attractive to neutral, attributing this shift to impressive year-to-date gains exceeding 30% and looming concerns regarding future growth trajectories.

Significant losses were observed among various companies, with ZTE Corp down by 3.3%, Talkweb Information declining by 3.4%, Zhejiang Huatie falling by 2.7%, Guangdong Aofei plummeting by 5.8%, and Toibet Huayu decreasing by 4.4%.

In summary, the Chinese stock market has seen two consecutive sessions of decline, driven by concerns over economic performance and increased trade tensions. The decision by UBS to downgrade the technology sector, along with notable losses among key companies, reflects investor apprehension regarding future growth prospects in this environment.

Original Source: www.tradingview.com

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