China stocks continue to show resilience as US tariffs batter global markets

Stock markets in China were mixed but cautious on Wednesday morning as investors continue to try to assess how US tariffs will affect global trade, company profits and national economies.

At the end of the morning session, the Shanghai Composite Index was up 0.24 percent after falling 2 percent at the opening bell. The Shenzhen Component Index rose 0.56 percent, while Hong Kong's Hang Seng Index lost 1.55 percent.

The focus is now on China after President Donald Trump slapped a further 50 percent tariff on imports from the country, taking the total to 104 percent. So far, China has pledged to "fight to the end" in the escalating tariff war. Investors worldwide are waiting to see Beijing's reaction to the latest escalation by Washington.

Nearly 2,500 companies were gainers on Chinese bourses, buoyed by strong government, investment fund and corporate support for the nation's refusal to buckle to US "bully" tactics. The rises were led by shares in the military, semiconductor and machinery industries. Related technology shares, including Guoxin Micro, Cambricon and Loogson Tech, all reached the daily trading ceiling of 10 percent.

Today's performance compared another down day on Wall Street. The Dow Jones Industrial Average fell 0.84 percent, the S&P 500 sank 1.57 percent, and Nasdaq Composite Index lost 2.15 percent.

Strong tariff measures imposed on major trading partners by Trump last week triggered waves of opposition, both overseas and in the United States. Billionaire hedge fund manager Bill Ackman, who endorsed Trump in last year's presidential election, said the president's refusal to back off punishing tariffs would lead to "a self-introduced, economic nuclear winter."

Robin Xing, chief China economist of Morgan Stanley, said on Wednesday that even if US does relent amid so much pressure, investors around the world will continue to harbor doubts about policy consistency in the world's largest economy.

"People will be fearful to either invest or consume, which could both cast long shadows on the global economy," said Xing, who has just returned from a business trip in the US.

Elsewhere in Asian markets at midday on Wednesday, Japan's Nikkei index was down 3.6 percent, and the South Korea Composite Stock Price Index (KOSPI) shed 1.46 percent.