Mumbai, Aug. 11 -- Chinese stocks fell on Tuesday as investor confidence weakened amid fading hopes of a quick easing in US-Iran tensions. The Shanghai Composite dropped 0.82% to 3,934.1, while the Shenzhen Component declined 0.40% to 14,259.4.

Markets remained cautious after President Trump called for compensation from Iran for victims of the conflict, while Tehran demanded reparations for recent US and Israeli strikes. The ongoing standoff reduced expectations of a quick reopening of the Strait of Hormuz, keeping concerns about shipping disruptions and global market risks high.

Liquidity conditions also drew attention after the People's Bank of China did not conduct any seven-day reverse repos on Tuesday. This was its first pause in s...