Mainland stocks fell on Thursday as investors took profits in financial shares while tech stocks led the Hong Kong market lower following Wall Street's overnight weakness.

The benchmark Hang Seng Index lost 309 points, or 1.17 percent, to end trading on Thursday at 26,149 while the tech index was just over 60 points, or 1.05 percent, down at 5,678 and the China enterprises index was down over 99 points, or 1.09 percent at 9,039.

Sentiment soured after overnight selloffs in ⁠US-listed, China-focused funds.

Tech shares led the decline after China tightened rules regulating ‍transactions on internet platforms.

UBS said it remained upbeat on China stocks after a stellar performance in 2025.

It forecast a 14 percent profit growth this year for companies underlying MSCI China, according to Janice Hu, China country head at UBS.

"The Hong ‌Kong market remains pretty attractive in 2026," Hu said, citing a rush ‍by Chinese companies to expand overseas, global investors' ‌need for asset allocation and Hong ‌Kong's ‌unique status as a connector.

Three Chinese technology firms – AI startup Knowledge Atlas Technology, semiconductor firm Shanghai Iluvatar CoreX and surgical robotics company Shenzhen Edge Medical – debuted higher after raising a combined US$1.19 billion, setting ‌the tone for what could ⁠be yet another busy year for new listings in Hong Kong.

The mainland losses came with the benchmark Shanghai Composite Index slipping down over two points, or 0.07 percent at 4,082 while the Shenzhen Component Index was 71 points, or 0.51 percent, down at 13,959 and the ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, was down just over 27 points, or 0.82 percent, at 3,302.

The blue-chip CSI300 Index lost 0.8 percent in its worst day in three weeks.

China's financial stocks dropped 1.8 percent as investors pocketed gains following a recent rebound.

Chinese brokerages, banks and insurers were big drags for ‍the market.

Artificial intelligence stocks rose on Thursday, after the country vowed to achieve secure and reliable supply of key core AI technologies by 2027.

Shares ⁠of Chinese makers of semiconductor materials, including Tangshan Sunfar Silicon Industries and Hubei Heyuan Gas, surged after Commerce Ministry said it was launching an anti-dumping probe into imports of chemicals used in chipmaking.

Chipmakers also climbed on ‌news that Beijing had asked some Chinese tech companies ‍to halt orders for Nvidia's H200 chips and was expected to mandate domestic AI chip purchases. (Reuters/Xinhua)