Increasingly violent protests are taking a further toll on Hong Kong's stock market, with shares falling more than 2 percent on Monday after police opened fire on protesters in the eastern part of the city, wounding at least one person.
The Hang Seng, Hong Kong's benchmark stock index, fell to its lowest point since the end of October.
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Video footage by local media showed a protester lying in a pool of blood.
"Mondays are typically a bad day for Hong Kong because of (weekend protests)," Stephen Innes, Asia Pacific market strategist at AxiTrader told Al Jazeera.
The Chinese-ruled city was beset by protests over the weekend after the death of a student who fell from a parking garage while police were trying to disperse crowds the week before.
Financial markets are also facing a double negative from US President Donald Trump's latest tirade about the US-China trade war and weak inflation data from China, which cast a pall over economic prospects, Innes said.
Losses stretched across Asian stock markets, as China's largest companies on the Shanghai Composite Index saw their shares decline more than 1 percent.
Shares in Japan and South Korea also tumbled, with the Nikkei losing early gains to fall 0.2 percent and South Korea's Kospi down 0.7 percent.
"The China-US trade war and the Hong Kong protest are combining to cast a negative pall on Asian markets today," said James McGlew, analyst at stockbroking firm Argonaut.
"Hong Kong protests have been dragging on for a while and the view from the financial world is that it's really starting to bite now. The further this drags on it's certainly going to be very negative."
Trade war in the driver's seat
Despite protests entering their sixth month, stocks in Hong Kong had rebounded about 9 percent from August, fuelled by market liquidity and optimism that the US and China could reach a first-phase deal to roll back tariffs before the end of the year.
However, the recent ability of the Hong Kong market to absorb negativity surrounding the protests was weakened by yet another flip-flop in US-China trade talks last Friday, said Freddy Lim, chief investment officer at robo-advisory firm Stashaway.
"We think the Hang Seng situation is knee-jerk. Longer-lasting and more meaningful market trends would rely more heavily on trade talks between US and China," Singapore-based Lim told Al Jazeera.
Trump sparked worries among investors over the weekend by saying that the US had not yet agreed to roll back tariffs on Chinese goods.
"I haven't agreed to anything," Trump said, after saying that China would like to get "somewhat of a rollback, not a complete rollback, 'cause they know I won't do it".
He added that the Chinese administration wanted to make a deal more than he did, as the tariffs were generating "billions of dollars" for the US Treasury.
Positive sentiment surrounding the trade war was previously supported by comments from officials in both countries, who said that the first phase of a trade deal could see tariffs rolled back.
Investors are still pinning their hopes on an amicable solution.
"I don't see it lasting," Bangkok-based Innes said of Trump's negativity towards scaling back tariffs. "It's just a lot of political posturing ahead of the 2020 US presidential elections."
In Hong Kong, however, the economy and the stock market could suffer longer-term effects caused by ongoing clashes between protesters and the city's police force. Anxiety is hitting the boardroom as companies ponder the risk of keeping foreign employees in Hong Kong, Innes said.
"As the protests go on and on and on, it affects Hong Kong not only as an investment centre but also companies bringing in foreign people to work. If I had a company, I would rather move people to Kuala Lumpur [in Malaysia] or Singapore," he said.