China’s blue-chip CSI300 Index hit its lowest level since February 2019 and was down 0.7% by 0258 GMT, while the Shanghai Composite Index fell 0.9%, touching its lowest level since late 2022.

Chinese shares continued to drop, with the CSI300 down 4.2% last week.

Multiple factors were in play including headlines around the export ban by the US, the widening Middle East conflict, and China’s strong third-quarter economic data print likely being interpreted as leading to a lower likelihood of stimulus in the fourth quarter, UBS analysts wrote in a note.

While regulators have introduced several policy tweaks to bolster market sentiment, Thomas Gatley, China strategist at Gavekal Research, argued that onshore markets face two problems that defy quick solutions: high global yields and the ongoing property crisis.

Property sales remain weak and developers are under intense cash flow pressures.

The US enjoys the biggest yield advantage against China in 21 years, with the yield gap between China’s 10-year government bonds and their US counterparts at 226 basis points.

Hong Kong market is closed on Monday for public holidays.