China stocks closed lower on Tuesday, with Shanghai index ending at a near one-year low, as tech shares were punched hard after the United States banned American companies from selling components to Chinese telecom equipment maker ZTE Corp. The blue-chip CSI300 index closed down 1.6 percent at 3,748.64 points, its lowest since August 2017, while the Shanghai Composite Index dropped 1.4 percent to 3,066.80 points, its lowest closing level since May 2017.
Sectors fell across the board, led by healthcare and material shares. US President Donald Trump accused Russia and China on Monday of devaluing their currencies, while the United States raises interest rates. China's foreign ministry said on Tuesday that information coming out of United States regarding the Chinese currency is "a bit chaotic", after Trump accused China in a Twitter post on Monday of devaluing its currency.
The US Department of Commerce has banned American companies from selling components to Chinese telecom equipment maker ZTE Corp for seven years after breaking an agreement reached after it was caught illegally shipping goods to Iran. ZTE's shares in Shanghai and Hong Kong were on a trading halt on Tuesday. ** China's tech shares were punched hard after the ZTE ban, with an index tracking major information firms tumbling nearly 4 percent.
The tech-heavy start-up board index also closed down 3 percent in its worst day since late March. Worries over escalating trade tensions between China and the United States intensified in late session after China's Ministry of Commerce said China will take temporary anti-dumping measures on US sorghum. Investors also pondered over data showing China's economy grew at a slightly faster-than-expected pace of 6.8 percent in the first quarter, buoyed by strong consumer demand, healthy exports and robust property investment.
The largest percentage gainers in the main Shanghai Composite index were Hna Innovation Co Ltd, which closed 10.08 percent higher, followed by Gansu Dunhuang Seed Co Ltd, which ended 7.04 percent up and Lawton Development Co Ltd that rose 6.05 percent. The largest percentage losses in the Shanghai index were Shanghai Fukong Interactive Entertainment Co Ltd, which closed 10.04 percent down, followed by Keda Group Co Ltd, which ended 10.04 percent lower and Shanghai Feilo Acoustics Co Ltd that plunged 10 percent.
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