China stocks flat, HK gains as trade tensions weigh
At the midday break, the Shanghai Composite index barely moved to hold at 3,456.51, hovering near a three-month high. China's blue-chip CSI300 index added less than 0.1%.
Defensive sectors helped lift the markets onshore, with the banking sector sub-index higher by 0.9% and liquor distiller sector up 0.8%.
Tech shares weighted on the markets, with the semiconductor sector and AI-related shares both losing 1.7%.
Hong Kong shares edged up after traders returned from a local holiday. The benchmark Hang Seng Index added 0.6% at 24,220.65, and Chinese H-share index listed in the city, the Hang Seng China Enterprises Index also rose 0.6%.
The property sub-index added 1.6%, helping boosting the markets.
Around the region, MSCI's Asia ex-Japan stock index edged up 0.1%, while Japan's Nikkei index was down 0.7%.
Caution prevailed across the region as investors await the trade talk progresses, after Trump said he was not considering extending the July 9 deadline for countries to negotiate trade deals with the United States.
The US and India are nearing a deal that would lower tariffs on American imports to the South Asian country, while doubt has been cast on a deal with Japan.
BlackRock Investment Institute said they are neutral on Chinese equities in the second half due to trade policy and stimulus uncertainties, but see selective opportunities in priority sectors that could receive targeted support.
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