SHANGHAI, September 9 (Reuters) - China and Hong Kong stocks dropped on Wednesday, following Wall Street's tech rout overnight, and as escalating Sino-U.S. relations and falling oil prices dampened risk appetite.

** Some mainland Chinese investors are seeking safe haven in bonds, as signs of tighter regulatory scrutiny and climbing yields threaten stretched valuation of technology shares.

** China's start-up board ChiNext , which is up 42% this year, slumped over 3% on Wednesday.

** China's blue-chip CSI300 index fell 1.5% to 4,622.56 points at the end of the morning session, while the Shanghai Composite Index slipped 1.1% to 3,280.96 points.

** In Hong Kong, the Hang Seng index dropped 1% to 24,385.51 points. The Hong Kong China Enterprises Index slid 1.1% to 9,725.97.

** Wall Street closed lower on Tuesday as heavyweight technology names extended their sell-off to a third straight session, sending the Nasdaq into correction territory. Adding to the gloom, oil prices hit lows not seen since June.

** Chinese semiconductor shares continued to slide as a possible U.S. sanction against Chinese chip-making giant SMIC cast a pall over the sector.

** Shanghai-listed shares of Semiconductor Manufacturing International Corp plunged 3.6%, while its Hong Kong-listed shares lost nearly 2%.

** Should the ban occur, more than half of SMIC's sales could be affected, potentially dealing a bigger blow to Chinese equipment and materials players, brokerage CLSA wrote in a note.

** Sentiment in China was also hurt by signs that regulators are stepping up crackdown on speculation. Three high-flying stocks listed on the ChiNext market suspended share trading on Wednesday, citing investigations into "abnormal volatility".

** It's time to swap stocks for bonds, said Li Bei, fund manager at hedge fund manager Banxia Investment.

** "Currently, A-share valuations are purely supported by risk appetite, which is totally unreliable. Reversal of sentiment can happen at any time," she wrote on Wednesday. (Reporting by Samuel Shen and Andrew Galbraith; Editing by Amy Caren Daniel)