Mainland stocks track global sell-off, end lower

Chinese mainland stocks tracked a global sell-off to edge lower on Tuesday, as escalating trade frictions between the US and other major economies steered investors away from riskier assets.

The blue-chip CSI300 index fell 1.1 percent to 3,520.17 points during trading, hitting its lowest in more than a year. The index then rebounded a little at the end of the trading day, closing 0.82 percent lower at 3,531.11 points.

Meanwhile, the Shanghai Composite Index hit a two-year trough.

Conflicting signals from the Trump administration over proposed restrictions on foreign investment in US technology companies, along with news that recently imposed import tariffs are starting to disrupt supply chains, sent global stock markets tumbling on Monday.

Real estate and airline shares continued to lead the decline amid a falling yuan.

An index tracking major developers on the mainland slumped 4.6 percent following a near 5 percent drop in the previous session, as a weakening yuan raised fears of capital outflow that could weigh on asset prices.

“We believe A-share investors are overly pessimistic. They kept ignoring good news and just put them as chances for further tightening – the better economic data, the higher probability that more deleveraging measures will come,” said Gao Ting, head of China Strategy at UBS Securities.

The trading volume declined and the turnover rate kept low, Gao added.