Chinese shares flat after after yuan devaluation

Chinese shares experienced mixed fortunes, with the Shanghai Composite ending flat, after the surprise news that the yuan has been devalued.

China's central bank said the move was a "one-off depreciation" of 1.9% in an attempt to make the exchange rate more market-oriented.

It follows the release of a string of weak economic data from the world's second largest economy.

The Shanghai Composite index ended down just 0.51 at 3,927.91.

The People's Bank of China manages the rate through the official midpoint, from which trade can rise or fall 2% on any given day.

Until now, it had been determined solely by the central bank itself. Making the rate more market-based will mean the midpoint will now be based on how the currency finished the previous trading day.

The yuan ended Tuesday at 6.3231 to the dollar, from 6.2097 yuan on Monday.

Shares of airlines were hit by the news, on worries it will increase their fuel bills. China Eastern, China Southern and Air China all dropped by more than 5%.

Imports also suffered, with a weaker yen likely to push up the price of imports, while shares in exporters were boosted.

Suning shares, traded in Shenzhen, were up by the daily maximum of 10%, following the announcement of the strategic partnership with online giant Alibaba made on Monday.

In Hong Kong, the Hang Seng index ended down 22.91 points at 24,498.21.

Outside China, the yuan decision led to traders being more cautious, with analysts fearing a new currency war could hit the region's markets.

In Japan, the Nikkei 225 index fell by 0.4% closing at 20,720.75, breaking a four-session winning streak.

Australia's benchmark S&P/ASX 200 closed down 0.7% at 5,473.20.

Shares in Cochlear dropped by more than 8%. The maker of hearing aids and equipment reported full-year results, and although profits rose they fell short of expectations.

In South Korea, the Kospi index also closed in negative territory, down 0.8% at 1,986.65.