HONG KONG: China stocks weakened to the lowest in six weeks on Monday, dragged by tech sectors, after lukewarm factory data added to concerns about slowing growth momentum.

The Shanghai Composite index lost as much as 0.6% to the lowest since April 17, before dropping 0.1% to 4,063.72 points by midday break.

China’s blue-chip CSI300 index was down 0.6%.

Tech sectors led the decline, with the CSI AI Index down 1.1% and the CSI Semiconductor Index losing 3.7% to a two-week low.

The Star 50 Index slipped 3.2%.

The energy sector jumped 3.4% and the bank sector added 0.3%, limiting losses.

In Hong Kong, the benchmark Hang Seng Index was up 0.9% at 25,402.80, and the Hang Seng Tech Index added 1.8% after briefly hitting a two-week high earlier in the session.

“Markets are looking crowded, with some profit-taking and increased disagreement among investors likely in the short term,” analysts at China Galaxy Securities said in a note.

However, crowded positioning alone is not a reversal signal — what matters more is whether the underlying sector momentum holds; the market may be entering a phase of range-bound consolidation with more volatility, they said.

China’s factory activity stalled in May as new export orders contracted and input costs kept rising, an official survey showed on Sunday.

A private survey on Monday showed the manufacturing sector expanded at a slower pace last month. Around the region, MSCI’s Asia ex-Japan stock index was firmer by 1.6%.

Japan’s Nikkei index hit a fresh record high on an AI boost.

Elsewhere, China’s planned rebalancing of indexes is expected to trigger an estimated $48 billion in two-way passive investment flows, according to Goldman Sachs, as major indexes undergo semi-annual adjustments later this month.