China Stock Market Seesaws Following U.S. Trade Talks and Regulatory Moves

China's stock market experienced a retreat on Monday from a five-week upward trend, as investors pivoted their attention towards developments in U.S. trade talks rather than Beijing's domestic economic controls. The Shanghai Composite index dropped by 0.2% after five weeks of gains, reaching a notable 3-1/2-year high.

The slide was notable in commodity-related stocks, following an earlier rally spurred by Beijing's new 'anti-involution' campaign designed to tackle overproduction and competitive pricing pressures. Despite this, Hong Kong's Hang Seng Index saw a 0.4% rise, supported by insurer gains.

Goldman Sachs positively revised its 12-month forecast for the MSCI China index due to optimistic U.S.-China relations and other market-supportive factors. Nevertheless, the overall market atmosphere remains uncertain, with continued emphasis on improving economic fundamentals to sustain long-term bullish trends.

(With inputs from agencies.)