China shares tumble to six-week low

China shares tumbled to six-week low on Friday, as the fears of a trade war between the world’s two largest economies jolted the country’s equity, bond and commodity markets.

China and Hong Kong stocks opened sharply lower, and were set for their biggest daily drop in over a month, after Beijing unveiled plans for tariffs on up to $3 billion of US imports.

At midday, the Shanghai Composite index was down 3.27 per cent at 3,156.89, after earlier hitting its weakest since Feb. 12. China’s blue-chip CSI300 index was down 3.21 per cent at 3,891.47.

Chinese H-shares listed in Hong Kong fell 2.88 per cent to 12,069.33, while the Hang Seng Index was down 2.81 per cent at 30,199.01, reports Reuters.

A sub-index tracking IT firms on the mainland slumped 4.8 per cent by lunch break, while IT firms in Hong Kong also fell 4.5 per cent, led by Tencent.

Tencent fell more than 4.0 per cent on Naspers Ltd’s plan to cut its stake in the Chinese internet giant.

The yield on highly liquid 10-year China Development Bank bonds fell 14 basis points in morning trade to 4.68 per cent before rebounding to 4.7225 by 0344GMT.

The price of 10-year treasury futures for June delivery, the most-traded contract, rose as much as 0.91 per cent. By midday, it was trading 0.54 per cent higher at 93.880.