Chinese stocks have entered bear territory, with Bloomberg reporting that the Shanghai Composite closed 20% lower than its previous high in January.
Investors are being deterred by concerns Chinese companies will be hit by US tariffs.
The Shanghai Composite index closed at 2,844, down -0.5%.
Asian stock markets fall
Share markets in Asia have fallen after uncertainty over the renewed trade tensions between the US and China.
President Trump warned on Sunday that the US' trading partners could face retaliatory measures if they did not end protectionist barriers.
The warning came as China's central bank said it would cut the amount of cash some banks had to hold in reserve by 50 basis points.
The measure which comes into effect on 5 July, will free up about $108bn for commercial banks to lend to other institutions and boost spending.
The People's Bank of China did not link the move to a potential trade war with the US but some analysts said it would cushion the impact of Trump's tariffs on Chinese goods.
China stocks were the worst hit, despite initial gains at the start of the trading week.
With just an hour before the end of trading, Hong Kong's Hang Seng is down 1.5%, while the Shanghai Composite dropped about 1%.
Markets in Japan and South Korea fared better.
Tokyo's Nikkei 225 closed down 0.8% and Seoul's Kospi slipped 0.1%.
Australia's ASX200 fell 0.2%.
Hong Hong falls
Asian markets fell on
investors turned cautious ahead of fresh US-China trade talks and developments on North
Korea after rises yesterday helped by President Donald Trump's willingness to help Chinese telecoms firm ZTE.
Tokyo's Nikkei 225 closed 0.2% lower at 22,818 points, Seoul's Kospi fell 0.7% to 2,458 points and Hong Kong's Hang Seng shed 1.2% at 31,152.
The Shanghai Composite bucked the trend, closing 0.6% higher.