China-Hong Kong Stock Markets Dip Amid U.S.-China Trade Negotiation Uncertainty

On Tuesday, China and Hong Kong stock markets saw their early gains evaporate as investor caution grew ahead of the ongoing U.S.-China trade negotiations in London. The discussions extend into another day, with the world's top economies striving to ease a protracted trade dispute.

Indices showed declines, with China's CSI300 dropping 0.5% and the Shanghai Composite falling 0.4%, ending a five-day winning streak. Meanwhile, Hong Kong's Hang Seng dipped slightly by 0.1%. The negotiations involve complex issues like rare earths, semiconductors, and student visas, leaving markets uncertain.

Trade tensions and weak economic indicators, like China's 34.5% plunge in exports to the U.S., coupled with domestic deflation, compound market pressures. Despite this, rare earth stocks gained, with China Rare Earth Holdings climbing 13%, as investors anticipate potential government stimulus in light of disappointing trade data.

(With inputs from agencies.)