Sunday, July 3

Tech, industrial stocks pull China shares lower as Beijing imposes new COVID curbs

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SHANGHAI — Chinese shares fell on Tuesday, with tech and industrials firms leading a deepening slump in afternoon trade, as new COVID-19 curbs in the country’s capital fueled worries over slowing growth despite Beijing’s pledges of economic support. ** The Shanghai Composite index ended down 2.41% at 3,070.93, posting its biggest drop since April 25.

** The blue-chip CSI300 index was down 2.34%, its biggest drop since May 6, with its financial sector sub-index lower by 1.49%, the consumer staples sector down 1.45%, the real estate index down 0.27% and the healthcare sub-index down 3.7%.

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** Tech firms, which have led a market rebound since late April, fell sharply. The CSI Info Tech index slipped 4.23% and Shanghai’s tech-focused STAR50 index dropped 4.73%.

** The smaller Shenzhen index ended down 3.54% and the start-up board ChiNext Composite index fell 3.82%.

** Automotive shares fell less than the broader market, with a sub-index tracking the sector falling 1.1%, after China said it would reduce some passenger car purchase taxes by 60 billion yuan.

** The tax reduction is among a number of steps China’s cabinet has pledged to support an economy wracked by widespread COVID-19 outbreaks that are hobbling an already-slowing economy.

** But in a sign of the challenge of controlling the coronavirus, Chinese Vice Premier Sun Chunlan called for more thorough measures to cut virus transmission and adhere to the nation’s zero-COVID policy during an inspection tour in Beijing.

** Foreign investors were net sellers of A-shares on Tuesday, with Refinitiv data showing outflows of more than 6.6 billion yuan ($988.85 million) through the Stock Connect program.

** Around the region, MSCI’s Asia ex-Japan stock index was weaker by 1.25%, while Japan’s Nikkei index closed down 0.94%.

** At 0708 GMT, the yuan was quoted at 6.6745 per US dollar, 0.39% weaker than the previous close of 6.6488.

($1 = 6.6744 Chinese yuan) (Reporting by Andrew Galbraith; Editing by Rashmi Aich)