China stocks fall as recovery pessimism lingers

China stocks slipped on Wednesday as concerns lingered about the world's second-largest economy despite last week's better-than-expected data, with foreign investor selling also weighing on market sentiment. ** Foreign investors sold a net 2.2 billion yuan ($301.46 million) of Chinese stocks via the Stock Connect so far on Wednesday. ** Tech giants listed in Hong Kong slumped 1.9%, weighing on the Hang Seng benchmark.

China stocks slipped on Wednesday as concerns lingered about the world's second-largest economy despite last week's better-than-expected data, with foreign investor selling also weighing on market sentiment. ** The blue-chip CSI 300 Index and the Shanghai Composite Index both slipped 0.3% by the midday recess.

** Hong Kong's Hang Seng Index lost 0.8%, while the Hang Seng China Enterprises Index dropped 0.9%. ** Asian stocks struggled for headway while 10-year U.S. Treasury yields stood at 16-year highs as surging oil prices drive inflation and set the scene for the Federal Reserve to project interest rates staying higher for longer.

** In line with market expectations, China kept benchmark lending rates unchanged at a monthly fixing. ** The decision came as recent economic data showed China's economy was finding its footing after a sharp slowdown, with both factory output and retail sales in August beating market expectations.

** However, Cong Liang, the vice chairman of the National Development and Reform Commission, said China's economy still faced a lot of difficulties and challenges. ** China will intensify macro-control efforts and strive to achieve annual economic development goals, Cong said.

** Shares in tourism, semiconductor , and automobile firms lost between 1% and 1.6% to lead the decline. ** Foreign investors sold a net 2.2 billion yuan ($301.46 million) of Chinese stocks via the Stock Connect so far on Wednesday.

** Tech giants listed in Hong Kong slumped 1.9%, weighing on the Hang Seng benchmark. ** "With Asia, GEM (Global Emerging Markets) and global funds already underweight China, especially GEM funds, we believe much of the pessimism has been priced in," HSBC said in a note.

** "The good news is the market is now cheap. We also see positives from the widespread improvement in August macro data." ($1 = 7.2978 Chinese yuan)