The Hang Seng Index fell 1.3 per cent to 18,586.07 as of 10am local time. The Hang Seng Tech Index dropped 1.6 per cent, while the Shanghai Composite Index added 0.4 per cent.
Investors are now assessing if China’s recent measures to shore up the property market will revive home sales and stabilise growth. Guangzhou and Shenzhen joined Shanghai in easing curbs on home purchases on Tuesday, joining other first-tier cities on a nationwide rescue package for the troubled industry. A Bloomberg gauge of Chinese property stocks trading in Hong Kong has surged 35 per cent in the past four months.
Sentiment was dealt a hit after the onshore yuan fell to 7.2480 against the US dollar, its lowest since November.
Caution also prevailed before the release of economic data from China and the US. China’s statistics bureau is due to publish May’s purchasing managers’ index data for the manufacturing sector on Friday. Economists expect it to stay in the expansionary zone. US personal consumption expenditure data is also due on Friday and expected to soften. The US Federal Reserve tracks the PCE price indexes for its 2 per cent inflation target.
Other major Asian markets retreated as investors turned cautious ahead of the key data releases. Japan’s Nikkei 225 slipped 0.2 per cent, while South Korea’s Kospi retreated 0.9 per cent and Australia’s S&P/ASX 200 lost 1 per cent.