The Shanghai Composite Index slipped 0.4% to 3,995 on Wednesday, while the Shenzhen Component Index declined 1.4% to 15,063, erasing gains from the previous session as investors assessed the inflationary effects of surging global energy prices driven by prolonged tensions in the Middle East.
China’s annual producer price inflation accelerated to 3.9% in May 2026 from 2.8% in April, marking the highest reading since July 2022. The pickup was fueled by higher commodity and energy costs, which were further exacerbated by conflict-related supply disruptions.
By contrast, consumer price pressures remained subdued. The annual CPI rate was unchanged at 1.2% in May, slightly below the consensus forecast of 1.3%. Core CPI also undershot expectations, easing to 1.1% from 1.2% in April.
Notable losers in the session included PetroChina (-5.6%), China Shenhua Energy (-3.5%), CATL (-1.1%), Zhongji Innolight (-1.9%), and BYD (-1.4%).
