The blue-chip CSEI 300 Index declined 1.1% in early trade, the biggest retreat in nearly two weeks, and the Shanghai Composite Index lost 0.9%.
Hong Kong’s benchmark Hang Seng Index lost 1.5%, pulling back from a one-month high.
Sentiment took a hit after Trump said on Tuesday that his administration was still considering a 10% punitive duty on Chinese imports due to fentanyl issues.
That put an end to the short-lived relief in Tuesday’s Asian trading hours after Trump held off announcing any China-specific tariffs on his first day back in office.
Sentiment will continue to come under pressure, which would weigh on risk assets, as there is a chance that Trump might announce more drastic measures to achieve his goals, analysts at Citic Securities said in a note. Leading declines onshore, the real estate sector tumbled 2.4% to pare gains made the previous day. China’s chip sector also gave up earlier gains to decline 0.6%, after Trump announced a private sector investment of up to $500 billion to fund infrastructure for artificial intelligence to outpace rival nations.