Chinese and Hong Kong stocks declined on Tuesday as investors booked profits in artificial intelligence and technology shares, while energy stocks gained amid rising Middle East tensions and higher oil prices. According to The Economic Times, the CSI300 index fell 0.8% by midday, while the Shanghai Composite dropped 0.4%. In Hong Kong, the Hang Seng Index was down 0.7%. Weakening economic indicators and concerns over domestic demand also weighed on sentiment, although robotics stocks bucked the broader market trend.
Technology stocks led the declines as investors took profits following recent gains. China's CSI Artificial Intelligence Index slipped 2.1%, while the 5G Communication Index lost 1.8%. Major Hong Kong-listed technology companies fell about 2%, with memory-chip maker Changxin Technology dropping 3.7% after retreating from a record high. However, robotics stocks outperformed, with the Robot Industry Index rising nearly 1% and leader Harmonious Drive Systems surging 5.5% ahead of the planned market debut of humanoid-robot maker Unitree on Wednesday.
Energy shares bucked the broader market weakness as oil prices climbed on concerns that stalled efforts to resolve the U.S.-Iran conflict could lead to further escalation. According to The Economic Times, PetroChina gained more than 2%, while coal stocks also advanced. The energy sector's outperformance came as investors sought safe-haven assets amid geopolitical tensions in the Middle East.
Consumer staples shares on China's mainland rose 0.4% despite signs of slowing economic activity. As reported by The Economic Times, industrial output and retail sales weakened at the start of the second half, highlighting the challenges posed by soft domestic demand and disruptions from extreme weather. UBS analysts said earnings from several major consumer companies due this week will be closely watched for indications of the underlying strength of consumer demand.
