Chinese stocks slip as global tensions weigh on sentiment

Chinese stocks fell on Tuesday as investor confidence weakened amid fading hopes of a quick easing in US-Iran tensions. The Shanghai Composite dropped 0.82% to 3,934.1, while the Shenzhen Component declined 0.40% to 14,259.4.

Markets remained cautious after President Trump called for compensation from Iran for victims of the conflict, while Tehran demanded reparations for recent US and Israeli strikes. The ongoing standoff reduced expectations of a quick reopening of the Strait of Hormuz, keeping concerns about shipping disruptions and global market risks high.

Liquidity conditions also drew attention after the People?s Bank of China did not conduct any seven-day reverse repos on Tuesday. This was its first pause in short-term liquidity injections since June.

AI-related stocks were among the main losers as investors moved toward more defensive sectors amid continued volatility in the technology space. NAURA Technology fell 1.83%, Victory Giant Technology dropped 4.01%, Cambricon Technologies declined 2.97%, and Hygon Information Technology lost 1.18%.

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