Chinese stocks fall as COVID woes and weak factory activity weigh

Chinese stocks fell on Wednesday as some major cities tightened COVID-19 restrictions to fight new outbreaks, while sentiment was also shaken after data showed factory activity extended. the drop in August. ** The CSI 300 index lost 0.6% at the end of the morning session, while the Shanghai Composite index fell 1.2%.

** The Hang Seng Index fell 0.4%, while the Hang Seng Index of Chinese companies edged down 0.1%. ** Guangzhou in China has imposed COVID-19 restrictions in parts of the city, joining Shenzhen in tackling local outbreaks, while several other larger cities have also tightened their COVID-19 restrictions this week.

**The official manufacturing Purchasing Managers’ Index (PMI) rose to 49.4 in August from 49.0 in July, but still remained within the contraction range as new coronavirus infections, the worst waves decades of heat and a struggling real estate sector have weighed on output. ** The new energy sector fell 4.5% to lead the decline, with new energy vehicles and photovoltaic companies down 4.1% and 5.7%, respectively.

** Shares of China’s biggest electric car company BYD Co Ltd plunged 9.5% in Hong Kong while they fell 7.1% in Shenzhen. ** Warren Buffett’s Berkshire Hathaway Inc has cut its stake in BYD Co, seven weeks after sparking speculation it might sell its entire multi-billion dollar stake in the company.

** The resources index fell 3.2%, with energy down 1.8% and non-ferrous metals down 3.6%. **However, property developers were up 1.7%, while banking and food and beverage stocks were up around 1% each.

** Shares of Alibaba in Hong Kong fell around 1%, while the Hang Seng Tech index rose 0.8% after opening down 2.5%. ** U.S. regulators have selected e-commerce giant Alibaba and other U.S.-listed Chinese companies for audit inspections starting next month, three sources told Reuters.

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