Chinese shares were down on Wednesday as the country's inflation split widened, with producer prices outpacing consumer prices.
The Shanghai Composite Index, the main gauge of Chinese stocks, slid 0.4% to 3,993.23. The Shenzhen Component Index plunged 2.1% to 14,954.10.
China's annual producer inflation accelerated to 3.9% in May. This was in line with the consensus forecast, but faster than the 2.8% recorded in April.
In contrast, annual consumer inflation stalled, remaining steady at 1.2%. This was lower than the consensus forecast of 1.3% and unchanged from the pace recorded in April.
Core inflation, which excludes volatile food and energy prices, rose 1.1% year over year, easing from 1.2% in April.
The widening gap between producer and consumer prices suggests manufacturers' ongoing difficulties in passing higher input costs downstream and thus suffering from margin compression, Bloomberg News cited Serena Zhou, senior China economist at Mizuho Securities.
In company news, BOE Technology (SHE:000725) controlling subsidiary BOE Energy Technology plans to terminate its application for a public issuance of shares and listing on the Beijing Stock Exchange. Shares of the electronics components producer closed 7% lower Wednesday.