The Hang Seng Index lost 0.3 per cent to 17,381.52 as of 11.15am local time, after gaining as much as 0.8 per cent earlier. The Tech Index dropped 0.9 per cent, while the Shanghai Composite Index added 0.2 per cent.

Tencent dropped 0.6 per cent to HK$307.80, Alibaba Group lost 1.5 per cent to HK$79.40 and rival e-commerce platform JD.com declined 1.4 per cent to HK$99.35. Food delivery platform Meituan lost 2.1 per cent to HK$109.20, and chipmaker SMIC weakened 2 per cent to HK$21.75.

Limiting losses, electric vehicle maker BYD added 0.7 per cent to HK$244. HSBC climbed 1.4 per cent to HK$58.55, leading gains among local lenders, as US Consumer Price Index data due today is expected to show inflation cooled, prompting bets that interest rates have peaked.

China’s credit-expansion data for October came in worse than expected as business and household borrowing remained weak. New aggregate financing came in at 1.85 trillion yuan in October, the People’s Bank of China said Monday, falling short of economists’ expectations of a 1.95 trillion yuan increase.

“Economic data showed more signs of renewed weakness,” Nomura analysts including Ting Lu said in a note to clients on Tuesday. “We maintain the view that growth stabilisation is not solid as the property and export sectors continue to contract.”

Meanwhile, fund managers including Cambridge Associates, Franklin Templeton and Abrdn have turned bullish towards cheap Chinese stocks after months of sell-off, and said the coming Central Economic Work Conference in Beijing next month will be the spark.

Valuation history signals China stock sell-off is ending, fund managers say

The Hang Seng Index has declined 0.1 per cent so far this month, extending the three-month sell-off since July, as China’s wobbly economic recovery and rising geopolitical tensions continued to weigh on sentiment. Traders will closely watch the meeting between Chinese President Xi Jinping and US counterpart Joe Biden.

Asian stocks advanced ahead of the US inflation data. Japan’s Nikkei 225 added 0.5 per cent, while South Korea’s Kospi jumped 1.2 per cent and Australia’s S&P/ASX 200 climbed 0.6 per cent.