Chinese stocks closed lower on Monday as the war in the Middle East triggered surging oil prices and a bearish risk appetite among investors.
The Shanghai Composite Index, the main gauge of Chinese stocks, lost 0.7% or 27.59 points, ending at 4,096.60. The Shenzhen Component Index inched down 0.7% or 105.12 points to 14,067.50 points.
Equities in China and even across Asia slipped due to a surge in fuel prices amid already weak economic prospects, reducing risk appetite, Reuters reported separately Monday.
"There's a lot of uncertainty, especially regarding how long the conflict will last," Reuters quoted Huajin Securities strategist Deng Lijun as saying.
Reports of a meeting between U.S. President Donald Trump and Chinese President Xi Jinping late in the month that could probably just keep the status quo instead of yielding breakthroughs could have contributed to the already gloomy outlook, Reuters said.
China's ongoing parliament meeting has not suggested major shifts in fiscal policy either, reiterating the need for a more proactive fiscal policy paired with a flexible monetary approach.
Meanwhile, producer prices stayed in deflationary territory in February at 0.9%, while inflation jumped 1.3% in February, exceeding the 0.8% rise estimated by analysts polled by Reuters.
On the corporate front, ZTE's (SHE:000063) Shenzhen shares closed 5% lower after its attributable profit declined 33% to 5.62 billion yuan in 2025.
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