“The Hang Seng Index is down, but single stocks are more diversified, just like the Dow Jones Industrial was down and the Nasdaq keep rallying,” said Alan Li, portfolio manager at Atta Capital, referring to the performance of US equities overnight. “The market is accelerating switching from old economy to new economy stocks, value stocks to growth stocks.”

Market sentiment worsened in the afternoon, Li said, as traders worried US-China tensions will further deteriorate once US President Donald Trump returns to the campaign trail, which he plans to do next week. As his poll numbers for re-election have weakened, Trump has ratcheted up his attacks on China on everything from Hong Kong’s status to the spread of the coronavirus.

In Hong Kong, Macau casinos and property stocks suffered big tumbles.

Henderson Land Development fell 3.1 per cent, while Sun Hung Kai Properties dropped 2.9 per cent, as investors remain cautious on the sector with added uncertainty about how the new national security law will impact Hong Kong.

Galaxy Entertainment tumbled 5 per cent, while Sands China dropped 4.2 per cent. The declines came even as Galaxy Chairman Lui Che Woo expressed hope on Wednesday that coronavirus-related travel restrictions that have devastated local casinos could be eased within a month. Macau casinos are heavily dependent on mainland visitors, from mom-and-pop gamblers to VIP “big whales”.

It is the second US-listed Chinese tech stock after Alibaba to launch a secondary listing in the city, putting the home-grown tech stars on track to become available at some point to mainland traders through the Stock Connect.

While in early trading, giddiness over the latest listing sparked a rally among new economy stocks, the gains lost steam as the day moved on.

Tencent, the Chinese social media and gaming giant, advanced as much as 2.1 per cent, but then closed down 0.9 per cent at HK$442.40. E-commerce giant Alibaba, the parent company of the South China Morning Post, jumped as much as 2.3 per cent, before sliding into a 1.2 per cent loss.

But Chinese food-delivery titan Meituan-Dianping, which soared as much as 6.2 per cent following a 5.4 per cent gain on Wednesday, ended with a 3.4 per cent gain.

The Shanghai Composite closed down 0.8 per cent, marking its second consecutive day of declines.

On the mainland, Kweichow Moutai, the world’s most valuable liquor maker and always one of the most heavily traded companies on the Stock Connect, finished down 1.6 per cent at 1,400.46 yuan, barely staying above the 1,400-yuan level for the sixth straight session.

One dark cloud over global markets is concern about the pace of the economic recovery and signs of a possible second wave of coronavirus infections in the US, the world’s largest economy.

“It was expected cases would rise a little once American’s returned to pre-pandemic behaviour, but right now a world of uncertainty around the virus could start to weigh on the economic recovery,” said Oanda senior market analyst Edward Moya.

Elsewhere in the Asia-Pacific region, stocks declined. Tokyo’s Nikkei 225 fell 2.8 per cent and Australia’s S&P/ASX 200 declined 3.1 per cent, while South Korea’s Kospi Index fell 0.9.

The threat still posed by the coronavirus pandemic has been overshadowed in markets of late by excitement over lockdowns being eased around the globe, with consumers returning slowly to shopping malls, restaurants and other businesses. The Hang Seng Index saw its longest advancing streak in 14 months, which ended Wednesday.

Federal Reserve chief Powell, in a speech overnight, said the key interest rate benchmark would likely remain at near zero through 2022, but warned that recovery in the world’s largest economy could be slow and driven by success in controlling the coronavirus.

“The extent of the downturn and the pace of recovery remain extraordinarily uncertain, and will depend in large part on our success in containing the virus,” Powell said. “We all want to get back to normal but a full recovery is unlikely to occur until people are confident it is safe to re-engage in a broad range of activities.”