Global Market Watch | China stocks dip to six-week low as Middle East conflict escalates

China and Hong Kong stocks tumbled on Thursday, joining a broader decline across Asia, as risk appetite was further dampened after a major escalation in the Iran conflict. ** The Shanghai Composite index lost 1% to 4,024.23 points by midday break, near the lowest ‌level since ⁠February ⁠3 that it hit earlier in the session

** The blue-chip CSI300 index also dipped 1%. ** Risk sentiment took a beating globally after Tehran fired missiles at oil and gas targets throughout the Gulf, sending oil prices sharply higher.

** Around the region, MSCI's Asia ex-Japan stock index was weaker by 2.1%.


** "Stock market volatility will ⁠stay elevated ‌for now and there's little visibility about how the conflicts will unfold. Both have dampened investors' willingness to ⁠deploy capital and kept them on the sidelines," said Cusson Leung, chief investment officer at KGI.

** The firm, however, continues to favour Chinese equities, as their lower correlation with global markets positions them as an attractive diversification opportunity, he noted. ** Declines were across the board, with the CSI SWS Non-Ferrous Metal Index and the CSI SH-SZ-HK Gold Industry ‌Index losing nearly 5% to rank among the biggest losers following the gold price plunge.

** However, the CSI 300 Energy Index jumped 2.5% and ⁠the CSI Marine Index added 1.6%.

** In Hong Kong, the benchmark Hang Seng Index lost 1.7%, and the Chinese H-share index, the Hang Seng China Enterprises Index, fell 1.3%. ** Internet giant Tencent tumbled nearly 6%, on track for the worst single-day decline since April last year, after the firm announced a higher AI investment in 2026 after chip curbs hit capex plans.