Stocks in China and Hong Kong fell sharply on Wednesday, with oil and maritime shipping companies hit hardest, as investors adopted a risk-off stance amid the escalating Middle East conflict and awaited policy signals from China’s annual parliamentary meeting.
By midday, the blue-chip CSI300 Index slid 1.6%, while the Shanghai Composite dropped 1.4%. Hong Kong’s Hang Seng Index tumbled 2.8% to a six-month low.
Onshore selling was concentrated in oil, maritime transport, and port stocks. The CSI Oil and Gas Industry Index fell 3.3% after China Petroleum & Chemical, CNOOC, and PetroChina issued abnormal-trading notices following more than 20% gains over the past three sessions, cautioning that operations remain normal amid geopolitical uncertainties in crude prices.
Port operators also suffered heavy losses, with Nanjing Port and Ningbo Marine each declining nearly 10%. Analysts at Huatai Futures warned that “geopolitical risks remain unclear and A-shares are in a catch-up decline,” advising investors to watch developments in conflicts and the upcoming National People’s Congress (NPC) session for policy signals.
China’s top leadership is set to release its annual government work report and budget plans on Thursday, alongside the outline of the 15th Five-Year Plan (2026–2030). Nomura economist Ting Lu expects Beijing to lower its 2026 GDP growth target to 4.5%-5.0% from around 5.0% in 2025, maintain a 4.0% fiscal deficit, and increase net financing through central and local government special bonds.
Some sectors provided support amid the selloff. The CSI Defense Index rebounded 1%, while the CSI Rare Earth Index climbed nearly 1%. In Hong Kong, financials led declines with a 3.6% drop, and tech majors slid 2%, marking a third consecutive session of losses.
Economic data added to market caution. An official survey showed China’s manufacturing activity contracted for a second consecutive month in February, reflecting weak domestic demand and investment pressures despite resilient exports.
($1 = 6.9176 Chinese yuan)