Stocks in China fell on Wednesday as some investors booked profits after the government announced sweeping changes to ease a tough anti-COVID policy that has battered the world's second-largest economy.

Sentiment was also dented by dismal trade data that showed China's exports and imports contracted more sharply than expected in November amid flagging demand at home and abroad, adding to fears a global recession is looming.

The blue-chip CSI 300 Index ended down 0.3%, after surging as much as 0.8% following the COVID easing measures, which had been widely expected. The Shanghai Composite Index lost 0.4%.

Meanwhile, Hong Kong's Hang Seng Index slumped 3.2%, and the Hang Seng China Enterprises Index plunged 3.3%.

China said on Wednesday it would allow COVID patients with mild symptoms to isolate at home, and drop a requirement for people to show negative tests when they travel between regions, among other measures.

While some of the changes echoed moves made by other countries many months ago, the announcement was the strongest sign so far that China is preparing its people to live with the disease, though analysts say the path to fully reopening the economy will be long and bumpy, and not without risk if new infections or deaths surge.

"Further loosening of COVID curbs is well expected, as there is no turning back of an arrow once it's shot, and we sell when the mood is high," said Wang Xin, portfolio manager at Tosan Fund Management Co.

Wang said his fund has been slashing stock exposure over the past few days as the market has largely priced in further easing in restrictions, and he warned of underestimating risks ahead.

Tourism-related stocks jumped as much as 4.2% at one point before ending up 2%, while consumer staples <,CSICS> and healthcare firms added 0.4% and 1.2%, respectively.

Underscoring the challenges to its economic recovery outlook, data earlier on Wednesday showed China's exports in November contracted 8.7% from a year earlier, while imports tumbled 10.6%, both missing expectations by large margins, due to weakening global demand and COVID outbreaks at home.

China should optimise epidemic prevention and control measures next year as it seeks to better coordinate policies with economic and social development, state media reported on Wednesday, after a meeting of the Communist Party's politburo.

The meeting also said China will focus on stabilising growth, employment and prices while preventing and defusing major systemic risks.

"The Politburo meeting sent positive messages for economic policies next year," said Zhiwei Zhang, chief economist at Pinpoint Asset Management. "I'd expect policies to become more market friendly in 2023."

Investors are now focusing on the upcoming Central Economic Working Conference this month, where Zhang expected more proactive policies to be announced than last year.

Nomura analysts said the reopening process is still full of uncertainties, such as a possible surge in COVID infections, and some economic disruptions might be inevitable.

Shijiazhuang Yiling Pharmaceutical Co, the maker of Lianhua Qingwen, a popular anti-coronavirus drug among Chinese people, saw its share price up 10% by the daily limit to a record high.

In the Hong Kong market, tech giants slumped 3.8%, and Macau casino operators lost 3.7%. Both sectors had led jumps in previous sessions amid a rally triggered by easing COVID policy bets. (Reporting by Shanghai Newsroom; Editing by Simon Cameron-Moore and Kim Coghill)