Shares in the metals sector are facing broad-based selling pressure. At the time of writing, China Molybdenum Co., Ltd. (03993) fell 5.65% to HK$18.72; MMG Ltd (01208) declined 4.4% to HK$9.35; JIANGXI COPPER (00358) dropped 4.17% to HK$36.16; Zijin Mining Group International Co., Ltd. (02259) was down 3.36% at HK$120.8; and Aluminum Corporation of China Limited (02600) decreased by 3.8% to HK$11.14.

The catalyst for the decline stems from a report released by the U.S. Federal Reserve on June 3rd, indicating that rising energy prices are elevating inflation levels. Since the second quarter of this year, repeated rebounds in U.S. inflation data, stronger-than-expected resilience in the job market, coupled with renewed strength in global energy prices, have fundamentally shifted market expectations regarding the Fed's monetary policy.

Cleveland Fed President Beth Hammack stated on Tuesday that if the already elevated inflationary pressures intensify further, the Federal Reserve may soon need to resume raising interest rates.

According to the CME FedWatch Tool, the probability of the Fed maintaining the current rate in June is 98.4%, with a 1.6% chance of a cumulative 25 basis point cut. For July, the probability of holding rates steady is 90.2%, with an 8.4% chance of a cumulative 25 basis point hike and a 1.4% probability of a cumulative 25 basis point reduction.