Daily Report | Mainland shares end lower amid worries of regulatory curbs, while Hang Seng ends at fresh 2016 high

Chinese stocks were battered on Wednesday, with companies traded on the startup board ChiNext suffering their worst day in more than a month amid reports that Chinese regulators will introduce tougher regulatory curbs on wealth management products.

A rumoured crackdown on speculative stock trading and risky shadow banking were also cited as factors weighing on sentiment.

Meanwhile, Hong Kong stocks recouped losses in late trading, extending their winning streak to a third session, reflecting fresh 2016 highs.

The Shanghai Composite Index slid 1.9 per cent or 58.17 points to 2,992.00. The startup board ChiNext Index sank 5.5 per cent or 124.16 points to 2,155.39, its biggest percentage drop since mid-June.

In Hong Kong, the Hang Seng Index rose 0.4 per cent or 89.26 points to 22,218.99, the highest close since December. The Hang Seng China Enterprises Index gained 0.3 per cent or 30.77 points at 9,093.02.

“Today’s sell-off [in China] was mainly triggered by news that regulators may launch a massive crackdown against speculative trading in stock markets and shadow lending by banks, in order to prevent systemic financial risks,” said Zhang Ying, a stock analyst for Shanghai Xinlande Securities.