China shares down despite growth data

Chinese shares have fallen despite the world's second largest economy reporting growth in the second quarter that was slightly higher than expected.

China's economy expanded 7% in the second quarter compared to a year ago - unchanged from the previous quarter when growth was at the lowest level since the global financial crisis.

The data failed to excite investors.

The Shanghai Composite closed down 3% at 3,805.70 while the Hang Seng index fell 0.3% to 25,055.76.

Industrial output figures, which measure production at factories, workshops and mines, also beat forecasts, rising 6.8% in June from the previous year.

Julian Evans-Pritchard, China economist at Capital Economics, said: "There are good reasons to think that the latest [growth] figures are mirroring a genuine stabilisation.

"There is growing evidence of an improvement in the wider economy."

US rate hints

Investors were cautious ahead of the congressional testimony by US Federal Reserve chair Janet Yellen due later on Wednesday.

They will be looking for hints regarding the timing of an interest rate rise in the US.

Ms Yellen said last week that the Fed was looking to lift rates at some point this year, but an unexpected drop in US retail sales in June raised concerns that the world's top economy may be slowing.

Japan's benchmark Nikkei 225 closed up 0.4% at 20,463.33 after the central bank decided to leave interest rates unchanged but slightly trim its economic growth projection.

The Bank of Japan wrapped up its two-day meeting on monetary policy on Wednesday. Despite noting signs of weakness in external demand, the bank held off on offering fresh stimulus.

In Australia, the S&P/ASX 200 index closed up 1.1% at 5,636.20.

China is Australia's biggest export market and resources stocks were largely up after the Chinese data.

Bucking the trend was BHP Billiton, which dropped 1% after announcing that it would write the value of its US onshore assets down by $2.8bn (£1.8bn).

South Korean shares were up after data showed that its unemployment rate for June was unchanged from the previous month at 3.9%.

The country's benchmark Kospi index finished up 0.7% at 2,072.91.