BEIJING: China and Hong Kong stocks fell on Friday, dragged by some tech stocks, as upbeat US economic data revived market concerns that China’s central bank might delay more easing measures to support the pandemic-hit economy.

Investors had previously expected more interest rate cuts from the Chinese central bank to support the economy. But with the US Federal Reserve now expected to keep rates higher for longer, further rate cuts from China could widen the policy rate gap between the two nations and pose more economic challenges.

China’s blue-chip CSI300 Index closed 1.44% lower, while the Shanghai Composite Index lost 0.77%. For the week, the two indexes lost 1.7% and 1.1%, respectively.

Hong Kong benchmark Hang Seng was down 1.28% and fell 2.2% for the week.

Asian equities slipped, while the dollar hovered around six-week highs as economic data and hawkish comments from Fed officials revived fears that the Fed will stick to its monetary tightening path.

US producer price index (PPI) rebounded 0.7% in January, the largest increase since June.

“The stronger than expected monthly PPI data, combined with the sticky consumer inflation released earlier this week, are clouding the Hong Kong and China markets,” said Kenny Ng, securities strategist, Everbright Securities International.

Investors worry that if US rate stays higher for longer, this would narrow the room for China’s central bank to ease interest rates further, as a widening of the gap between the two countries’ interest rates would fuel portfolio outflow.”

CSI Computer Index lost 4.24%, while the CSI Internet Finance Index fell 3.42%.

Hang Seng Tech Index lost 2.51%, dragged lower by China internet search engine giant Baidu Inc, down 4.6%.

Shares of China Renaissance, a boutique investment bank, hit a record low, after the company said it was unable to contact its chairman and chief executive Bao Fan.