China and Hong Kong Stocks Hold Steady Amid Trade and Semiconductor Concerns

On Tuesday, stock prices in China and Hong Kong stayed mostly the same. Investors were waiting for more information about trade, especially after the Trump administration increased checks on semiconductor imports.

China’s blue-chip CSI300 Index went up a tiny bit, less than 0.1%, while the Shanghai Composite Index rose by 0.2% when the market closed, after moving up and down throughout the day. In Hong Kong, the Hang Seng Index finished up 0.3%, after starting the morning with ups and downs.

The Trump administration has started looking closely at semiconductor imports due to national security concerns. They recently exempted some Chinese tech products from high tariffs, but they will soon face new duties.

This ongoing uncertainty around trade affected chip stocks in both markets. The CSI Semiconductor Industry Index fell by 1.2%, and the electronics subindex dropped by 1.1%, losing most of what they gained on Monday. The Hang Seng Tech Index also fell by 0.7% in Hong Kong. Notable chip maker SMIC went down by 4.5%, and Hua Hong Semiconductor decreased by 3.2%.

Yan Wang, a chief expert on emerging markets and China at Alpine Macro, said that the U.S.-China trade situation is changing all the time. He advised against taking big risks in Chinese stocks in the current climate because there is still a lot of uncertainty.

On a positive note, the CSI Banks Index went up by 1.5%, and the consumer staples sector gained 0.3%, helping to offset some losses in the mainland market.