Mainland stocks close mixed; tech shares gain

Chinese mainland stocks ended mixed on Monday, with A shares in Shanghai managing to recoup most of their earlier losses aided by gains in shares of tech firms.

The blue-chip CSI300 index fell 0.43 percent to 3,390.34 points while the Shanghai Composite Index lost 0.34 percent to 2,785.87 points.

Both indexes slumped in early morning trade, tracking a global sell-off, as investors reacted to a renewed rout in the Turkish lira that dampened risk appetite for emerging markets.

The lira tumbled on worries over Turkish President Tayyip Erdogan’s increasing control over the economy and deteriorating relations with the US.

“The lira’s depreciation will have a knock-on impact on emerging markets and China stocks tracking losses today is quite normal,” said Zhou Yu, an analyst with Pacific Securities.

Investors are reacting overly to bad news amid the broad weakness in the stock market, as sentiment is relatively fragile for the moment, Zhou added.

Most sectors lost ground for the day, though tech firms bucked the trend, with the tech heavy start-up board index closing 1.3 percent higher. An index tracking IT firms gained 2 percent, with more than 10 IT firms closing higher at the maximum allowed limit of 10 percent.

China’s leading tech firms have been rallying on hopes of policy boost from the central government, as the country aims to reduce its dependence on foreign technology amid trade frictions with the US.