Chinese equities ticked slightly lower on their first day of trading following the week-long Lunar New Year holidays, defying expectations for the mainland market to play catch-up with the steep fall in global stocks this week.
The Shanghai Composite traded down 0.2 percent on Friday, while the Hang Seng China Enterprises Index (HSCEI) of mainland companies listed in Hong Kong gained 0.8 percent.
This follows a turbulent period for global stocks, with U.S. and Japanese equities dropping to multi-month lows earlier in the week as soft U.S. economic data compounded worries about emerging markets.
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"Because other markets had fallen so much, a lot of people had expected China stocks would follow some of the losses, but they have been relatively flat," Jackson Wong, vice president, Tanrich Securities told CNBC.
"This is because we didn't have any major bad news out of China during the holidays—there were no significant policy announcements or liquidity problems," Wong said.
In addition, the relatively closed nature of China's equity markets means they are not always correlated with global equities and often run their own course, he noted.
Another factor behind the subdued reaction of mainland equities is they had already seen selling pressure prior to the holidays, said Audrey Goh, equity strategist at Standard Chartered, such that valuations are looking more attractive now.
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The benchmark Shanghai Composite is down 4 percent year-to-date, while the HSCEI has lost 11 percent over the same period. The latter index is trading at a price-to-earnings ratio of 6.5, the lowest since 2008, according to Standard Chartered.
Furthermore, the country does not face many of the issues dogging emerging market peers, such as large current account deficits, she said, helping to shield the market from contagion risks.
China's current account surplus grew to $49.8 billion in the fourth quarter from $40.4 billion in the previous three months, the foreign exchange regulator said Friday.
—By CNBC's Ansuya Harjani. Follow her on Twitter:@Ansuya_H