The blue-chip CSI300 Index opened down but clawed back losses to edge up 0.3 percent by the lunch break, while the Shanghai Composite Index rose 0.2 percent. Bucking the rally, Hong Kong's benchmark Hang Seng, which did not directly benefit from state support, was down 1.6 percent.

The United States said 104 percent duties on imports from China would take effect on Wednesday, even as the Trump administration moved to quickly start talks with other trading partners targeted by President Donald Trump's sweeping tariff plan.

The offshore yuan touched record-low overnight and investors are watching closely how China will respond.

"The first real battleground of the tariff war is financial markets, especially stock markets," said Ting Lu, chief China economist at Nomura. "The financial markets of both economies have been severely hit, and the worst might be yet to come."

Lu expects China's stabilization funds, supported by the country's central bank, to intervene significantly in stock markets over coming weeks.

Top Chinese brokerages have pledged to help steady domestic share prices, the Shanghai bourse said, while scores of listed companies unveiled stock-buying plans.

Chinese state holding companies, led by Central Huijin, continued to support the stock market by increasing share investment.

The escalating trade war has also prompted investors to shift their attention to self-reliant high-tech sectors, seen as winners in China's push for technological independence. Semiconductor and AI-related shares rose 5 percent and 2.7 percent, respectively.

Chip giant SMIC listed in Hong Kong jumped as much as 11 percent.

Beeneet Kothari, managing partner at Tekne Capital Management, a New York-based hedge fund, said they remain invested in China and prefer leading semiconductor firms.

"If you look at the largest semi companies in the West, these companies have about 40 percent of their revenues coming from China," Kothari said. "I think that the number over 5-10 years is going to zero. The West wants to cut off. China wants to be independent."

The CSI Defence index rose 4.7 percent.

China's policies this year fully account for various uncertainties, China's Premier Li Qiang said on Tuesday, adding that Beijing was "fully capable of hedging against adverse external influences".

Property shares traded onshore and offshore climbed 4.2 percent and 1 percent, respectively.

Gao Le, investment advisor of Galaxy Securities, said that a trade deal with the US is unlikely any time soon and that investors needed to brace for volatility.

"Don't expect any concessions like those from Vietnam or Japan," Gao said. "China's 5,000 years of history tells us that what you cannot get on the battlefield cannot be secured at the negotiation table."