China Stocks Extend Fall Ahead of Trump–Xi Summit

The Shanghai Composite fell 0.3% to 4,204 on Wednesday, while the Shenzhen Component edged down 0.2% to 15,799, extending losses from the prior session as technology stocks came under broad pressure while investors geared up for the highly anticipated Trump–Xi summit. Hygon Information Technology dropped 4.6%, Zhongji Innolight fell 1.4%, NAURA Technology Group declined 3%, and Huagong Tech lost 3.4%, as sentiment in the sector weakened on reports that South Korea is considering a universal dividend tied to recent gains in AI infrastructure stocks, raising concerns about valuations across the sector. Meanwhile, investors are closely watching the high-stakes summit between U.S. President Donald Trump and Chinese President Xi Jinping on May 14–15, with talks set to cover a broad range of sensitive issues. Trump has indicated that trade will remain the central focus of the discussions, tempering expectations that the Middle East conflict will dominate the agenda.

The Shangai Composite Index decreased 9 points or 0.22 percent on Tuesday to close at 4216 points. The decline was led by Shanghai Electric (-4.61%), Inner Mongolia BaoTou Steel (-3.82%) and Yonyou Soft (-3.80%). On the upside, the strongest performers were Datang Intl (10.02%), Jiangsu Hengrui (4.30%) and Sanan Optoelectron (3.62%).

The Shanghai Composite slipped 0.25% to close at 4,214 on Tuesday, while the Shenzhen Component Index fell 0.47% to 15,825, with both benchmarks retreating from multi-year highs as investors locked in profits ahead of a closely watched meeting between Presidents Donald Trump and Xi Jinping. Markets are hoping the talks will at least preserve the fragile US-China trade truce. The two leaders are also expected to discuss the Iran conflict and Taiwan. President Trump is scheduled to arrive in Beijing on Wednesday evening, while the US is expected to host Xi Jinping during a reciprocal visit later this year. Sentiment was further pressured by fading hopes for progress in US-Iran peace talks, as Trump said the ceasefire was on “massive life support” after Tehran’s rejection of a US-backed proposal aimed at ending the conflict. Notable decliners included Foxconn Industrial Internet (-2.2%), Contemporary Amperex Technology (-3.33%), Weichai Power (-2.48%), and Sungrow Power Supply (-2.91%).