The Hang Seng Index fell 1 per cent to 25,319.39 at the noon break on Tuesday, while the Hang Seng Tech Index dropped 1.8 per cent. On the mainland, the CSI 300 Index and the Shanghai Composite Index both slipped 0.1 per cent.
With the market digesting the outcomes of trade talks between the US and its key trading partners, investors were looking for fresh catalysts that could sustain the gains that drove the Hang Seng Index to its highest level in three and a half years. The Hang Seng gauge has risen 26 per cent this year, second only to South Korea’s Kospi in the Asia-Pacific region.
All eyes will be on two meetings that will guide monetary and industrial policies in the world’s two largest economies. Fed members will convene on Thursday and the US central bank is widely expected to stand pat on its benchmark borrowing costs. In China, President Xi Jinping is expected to begin a Politburo meeting this week, at which top leaders will likely restate the case for phasing out overcapacity in industries ranging from solar to electric vehicles and lithium batteries.
“The market may need a breather before it can resume the rally,” said Amber Zhou, an analyst at Haitong International. “With the pressure on growth increasing, the focus will be shifted to these meetings to see if there will be anything exceeding expectations to come out.”
