* Hang Seng finishes 0.81% in volatile trading
* SSEC -1.82%; down 9.98% from the February 18 high
* CSI300 down 2.15% after flirting with benefits
* Yuan moves higher against dollar after early weakness (Recycling with close Hong Kong)
SHANGHAI, March 9 (Reuters) – Hong Kong’s Hang Seng index ended on a higher volatile session on Tuesday, while the Shanghai Composite China index stood on a correctional record as investors struggled with the tighter policy expectations and a slow economic recovery.
The decline in A shares comes amid widespread sales of global assets in tandem with a rise in bond yields and fears that inflation will force central banks to withdraw from accommodation policies earlier than was expected.
“Premature policy tightening could pose risks to the economy but maintaining an appropriate policy for too long could warm the economy and the market,” said Michelle Qi, head of equity at Eastspring Investments. in Shanghai.
“It will also be difficult to strike a balance between stabilizing short-term growth and encouraging structural reforms. ”
The Hang Seng finished the day up 0.81%, with funding rising 1.08% and supporting. The index had fallen earlier in the day when the tech sub-index fell as much as 4.64% before regaining ground to end 0.23% lower.
“This is just a bit of a volatile trade as we have seen a big drop in the last few sessions,” said Alex Wong, director at Ample Finance Group in Hong Kong.
“The overall market is not so bad because people are just circulating in the region … they are not bearish on everything,” he said, adding that he expected the market to stand. .
The Shanghai Composite index fell 1.82% to 3,359.29 at the end of a session that saw it flirt with small gains. It is now down 9.98% from a multi-year high on February 18, just shy of the 10% fall that is usually described as a correction.
The blue-chip CSI300 index, which fell in correction last week, was eliminated from a small midday rise to go further down. It hit its lowest point since Dec. 15 before closing down 2.15% at 4,971.00.
“China’s economic recovery has slowed … while rates have been steadily rising. Such a mix was not good for equity, ”said Zheng Zichun, an analyst with AVIC Securities.
Zheng said that other currencies are also under pressure to sell to deal with redemptions from retail investors, and that market correction could delay the launch of new currencies.
Popular stocks such as Kweichow Moutai Co. Ltd and into areas such as small caps have been pushed out by investors with concerns about how authorities might revalue.
The heavy alcohol maker turned from a midday gain to a 1.17% lower close, after falling 4.86% on Monday. Moutai shares have fallen more than 26% since the February 18 summit.
Despite the day’s loss, foreign investors remained net buyers of A shares through the northern Stock Link, according to Refinitiv data.
China’s yuan also whipsawed, touching a two-and-a-half-month low before recovering all losses for trading at 6.5235 per dollar around 0730 GMT. (Reporting by Andrew Galbraith and Luoyan Liu; Editing by Subhranshu Sahu)