SHANGHAI, Aug 8 (Reuters) - China’s stock fell on Wednesday after the United States said it would begin collecting 25 percent tariffs on an additional $16 billion worth of Chinese goods this month, the latest volley in an increasingly heated Sino-U.S. trade war.
The Shanghai Composite index fell 0.5 percent, and the blue-chip CSI300 index was 0.6 percent lower.
The falls came a day after both indexes posted their biggest daily gains since 2016, rebounding from four days of heavy losses.
Shares in Hong Kong were up slightly, with the Hang Seng index gaining 0.1 percent and the China Enterprises index up less than 0.1 percent.
The latest U.S. tariffs on 279 imported product lines from China target semiconductors as well as a broad range of Chinese electronics, plastics, chemicals and railway equipment, and come after Washington slapped tariffs on $34 billion of Chinese goods last month.
They also follow China’s proposed retaliatory tariffs on $60 billion worth of U.S. goods ranging from liquefied natural gas (LNG) to some aircraft, which came after the Trump administration proposed a higher 25 percent tariff on $200 billion worth of Chinese imports to the United States.
The yuan strengthened despite what traders described as a bearish outlook for the currency, as the central bank guided the currency higher with its daily fixing.
A Bloomberg report, citing unnamed sources, said that China’s central bank on Monday urged some banks to prevent “herd behavior” and momentum-chasing moves in the foreign-exchange market.
On Wednesday, the People’s Bank of China set the midpoint of the yuan’s daily trading band at 6.8313 per dollar, 118 pips firmer than the previous fixing of 6.8431.
The currency opened at 6.8140 per dollar on the spot market and was changing hands at 6.8228 as of 0220 GMT, 50 pips firmer than the previous late session close of 6.8278.
Reporting by Andrew Galbraith and Winni Zhou; Editing by Sam Holmes