HONG KONG: Hong Kong stocks fell to a three-week low on Tuesday after data showed unexpectedly weak loan demand in China in October, but mainland shares were steady, partly aided by a report that China plans to cut taxes on home purchases.

Hong Kong’s benchmark Hang Seng was down 1.7% at midday, heading for a third straight day of losses. China’s blue-chip CSI300 Index climbed 0.4%, while the Shanghai Composite Index gave up earlier gains to trade 0.1% lower.

Chinese banks extended 500 billion yuan ($69.5 billion) in new loans last month, falling sharply from September and trailing analysts’ expectations, according to data released after the close of market hours on Monday.

“Weak loan growth for both households and corporates continues to underscore fragile domestic demand,” analysts at Bank of America said in a note. “The recent pivot in policy stance was a welcoming sign but more is warranted to stabilize growth going forward,” they added. The weak reading on credit demand came on top of data showing the slowest consumer price growth in four months in October and deepening producer price deflation.

Sentiment in China has remained largely downbeat after Beijing’s dissapointing stimulus package announced on Friday. But the mood was lifted somewhat by a Bloomberg news report saying China is preparing to cut home-buying taxes. An index of China’s real estate stocks rose 0.5%.

In Hong Kong, tech stocks led the decline, with market heavyweight Alibaba dropping 2.5% and Meituan losing 5.2%. The Hang Seng has lost about 13% since its early-October peak as investors took profit from a stimulus-triggered rally starting in September, while the CSI300 Index has declined 2.5%.

China’s yuan was also under pressure and weakened to 3-1/2-month low on Tuesday on worries that US President-election Donald Trump will impose higher tariffs on Chinese goods after he takes office in January.