Chinese stocks were little changed on Monday, with gains in technology shares offsetting declines in banks and insurers after Beijing unveiled a major capital-injection plan to strengthen the country's financial system, Reuters reported.
The Shanghai Composite was down 0.2% at 3,920.70 points at the midday break, while the blue-chip CSI300 index gained 0.2%.
Technology stocks outperformed as chip-related companies tracked gains among their U.S. peers. The ChiNext Composite rose 2.6%, while Shanghai's technology-focused STAR50 index advanced 1.6%.
The chip sector climbed 2.6%, while the CSI 5G Communication Index gained nearly 5%. Zhongji Innolight jumped 8.1%, leading gains among major chip-related companies.
Financial stocks came under pressure after China's finance ministry announced plans to lead a combined $54 billion capital injection into state-owned insurers and banks. The move is part of Beijing's broader effort to strengthen capital levels across the financial system.
The insurance sector fell 2.5%, while banking stocks declined 1.5% as investors assessed the implications of the capital-raising measures.
Investors were also closely monitoring China-U.S. relations. Reuters reported that Chinese President Xi Jinping is preparing a large business delegation to accompany him on a planned visit to Washington, an unusual move given tensions between the two countries and continued U.S. scrutiny of Chinese investment.Markets are also expected to remain sensitive to changes in expectations for U.S. interest rates, with investors assessing upcoming economic data for clues about the Federal Reserve's policy path.
Defensive large-cap stocks could remain relatively resilient as external uncertainties persist, while technology shares may continue to benefit from optimism surrounding artificial intelligence and semiconductor demand.
In Hong Kong, the Hang Seng Index and Hang Seng Tech Index were both down about 1%.
Across Asia, stocks broadly advanced on Monday after a stronger U.S. jobs report was seen as supportive of global economic growth. Oil prices edged higher following attacks involving the United States and Iran on ships in the Gulf.
With China-U.S. relations, U.S. monetary policy expectations and Beijing's efforts to strengthen its financial system all in focus, investors are likely to remain cautious despite the resilience of technology stocks.
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