Chinese Stocks Slip as Investors Remain Cautious Before US Talks

Chinese stocks experienced a slight decline as investors remained cautious ahead of the upcoming weekend trade talks between the two largest economies in the world.

The onshore benchmark CSI 300 Index ended Friday morning down 0.2%, while a gauge of Chinese firms listed in Hong Kong decreased by 0.3%. Despite this decline, both indexes are still close to recovering losses faced after President Donald Trump announced tariffs as high as 145% on Chinese goods last month.

The cautious sentiment stems from Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer preparing for meetings with Chinese Vice Premier He Lifeng in Switzerland this weekend for trade negotiations. Trump indicated that if the talks go well, he might consider reducing tariffs on China.

While these discussions seek to alleviate the tariff dispute, hopes for a swift resolution remain low. Another sign of ongoing investor unease is the market’s reaction to recent data showing unexpected export growth in China for April, despite Trump’s tariffs.

“China continues to encounter significant uncertainty regarding a deal with the US, and the long-expected stimulus has been limited so far,” remarked Patrick Pan, equity strategist at Daiwa Capital Markets Hong Kong. He added that even if the CSI 300 sees a rebound in the future, “I won’t be overly optimistic due to the ongoing concerns.”

The onshore benchmark has risen over the last three sessions, fueled by stimulus measures from Chinese authorities, including interest rate cuts and a reduction in banks’ reserve requirement ratios.

© 2025 Bloomberg

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