In Hong Kong, the benchmark Hang Seng Index ended trading for the day 18.56 points, or 0.077 percent, down at 24,162.87.
The Hang Seng China Enterprises Index fell 0.15 percent to end at 8,767.36 while the Hang Seng Tech Index fell 0.76 percent to end at 5,392.19.
Further north, the benchmark Shanghai Composite Index ended down 0.44 percent at 3,384.82.
The Shenzhen Component Index closed 0.86 percent lower at 10,162.18.
The ChiNext Index, tracking China’s Nasdaq-style board of growth enterprises, was down 1.17 percent to close at 2,037.27.
The trade talks extended to a second day as top officials from the world’s two largest economies sought to defuse a bitter dispute that has widened from tariffs to restrictions over rare earths, threatening a global supply chain shock and slower economic growth.
“US-China talks are definitely the focus for markets this week, yet after the first day of negotiations we’re seeing that markets are relatively flat,” said Sean Teo, a sales trader at Saxo in Singapore.
The two parties are negotiating more complex strategic issues like rare earths, semiconductors and student visas, which are unlikely to be resolved in this meeting alone, he said, so markets are taking a more wait-and-see approach after the initial optimism.
The meeting comes at a critical time when China’s exports to the US plunged 34.5 percent in May.
Semiconductor and defence stocks led the decline, dropping more than 2 percent each at the close.
Shares of rare earth companies, which is at the center of the negotiations, extended their rally, with China Rare Earth Holdings jumping 13 percent, after a 60 percent gain in the previous session.
Hang Seng Mainland Properties gained 1.9 percent, following a new government guideline released on Monday that vowed to increase the supply of affordable housing.
Weaker-than-expected trade and inflation data on Monday is adding to investor hopes of more government stimulus, Bob Savage, head of markets macro strategy at BNY, said in a note. (Reuters/Xinhua)
