- Fidelity China Special Situations reported Friday a decline in half-year net assets undershooting its benchmark following a significant correction in Chinese stock markets in October.

For the six months to 30 September, net asset value fell 9.1%, compared with 4.0% decline in the MSCI China Index - the company's benchmark Index.

The company’s share price total return for the six month period fell 8.8%.

The portfolio underperformed the benchmark Index because of better performance by companies in the index that the company had not held during the reporting period, it said.

The underperformance was also exacerbated by volatile Chinese stock markets during half-year, which saw the performance of the portfolio's two largest holdings, Tencent and Alibaba, post declines.

Fidelity China Special Situations cited the escalating trade US-China trade tensions as a 'concern,' saying there were 'no winners' in a trade war.

Chinese exporters would see higher import duties on their products sold in the US and the US consumer would likely to see higher prices and increased inflation as a result, the company added.

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