SHANGHAI: Chinese shares fell on Thursday, snapping a four-day win streak, after an abrupt US order for closure of the Chinese consulate in Houston stoked geopolitical tensions and offered exits for investors who profited from the market's recent rally.

The Shanghai Composite Index fell 0.2% to 3,325.11 and the blue-chip CSI300 index was pretty much flat. Both benchmarks flitted in and out of positive territory during the session.

The smaller Shenzhen index was flat while the start-up Chinext board gained 1.1% A-shares worth 711 billion yuan ($101.61 billion) will be freed from such lockups in the next one month, including 324 billion yuan from the nascent Nasdaq-style STAR board, according to a report from China Renaissance.

An index that tracks the 50 most representative stocks on STAR was published for the first time on Thursday. It fell 0.2%. The CSI300 real estate index fell 2.3% as more cities tightened home purchase curbs.

About 40.70 billion shares were traded on the Shanghai exchange, compared with the previous trading session's 39.33 billion. The Shanghai stock index is up 9% this year and the CSI300 has risen 15%. Shanghai stocks are up 11% this month.

The United States gave China 72 hours to close its consulate in Houston amid accusations of spying. China called the move "unprecedented escalation". A source said Beijing was considering shutting the US consulate in Wuhan.

"Tension between the US and China is not something that's coming as a surprise. This is normal profit taking in my opinion," said Frank Benzimra, head of Asia equity strategy at Societe Generale in Hong Kong.

Zhang Qi, Shanghai-based analyst at Haitong Securities, said many companies were over-valued in the market's recent rebound while the expiry of IPO lockup periods added pressure.