China, HK stocks track Asia lower on Mideast, inflation concerns

SHANGHAI — China and Hong Kong stocks closed lower on Wednesday, following broad declines across Asia amid prolonged Middle East tensions and inflation concerns.

China’s blue-chip CSI300 Index fell 0.04%, while the Shanghai Composite Index dropped 0.2%. Hong Kong’s benchmark Hang Seng Index declined 0.6%.

In contrast, the CSI New Energy Index rose 1.1% as stalled U.S.-Iran talks kept oil prices elevated. U.S. President Donald Trump said the United States may need to strike Iran again, but suggested that Iran is seeking a deal to end the war that has unsettled markets and sent energy prices higher.

Semiconductor shares rallied 4.6%, helping to limit benchmark losses. Hua Hong Semiconductor surged 19% after Yangtze Memory Technologies, the country’s leading flash memory chip maker, submitted its IPO tutoring registration report, officially starting its onshore listing process.

Onshore financial and property shares fell 0.9% and 2%, respectively. Meanwhile, tech giants listed in Hong Kong rose 0.3%, though they remain down 12% so far this year.

On the policy side, China kept benchmark lending rates unchanged in May for the 12th consecutive month, in line with market expectations.

First-quarter 2026 earnings from internet giants, reported over the past week, have boosted confidence in a valuation re-rating for the MSCI China Index. JP Morgan upgraded the consumer discretionary sector to “neutral” from “underweight” and reiterated its positive view on China’s AI sector.

-Reporting by Shanghai Newsroom; Editing by Ronojoy Mazumdar and Sonia Cheema/Reuters