Broadly speaking, 2019 has been a good year for stock investors.

But there’s been a notable tone of market jitters this week, with the ASX Small Ords on track for its third fall in four days.

Based on the afternoon price action, markets have been at the mercy of news headlines amid another round of tensions in US-China trade.

The latest touch-point relates to developments in Hong Kong, where government protests have been raging for the last six months.

Overnight, US lawmakers overwhelmingly voted to support the passage of a bill aimed at protecting human rights in Hong Kong.

President Trump is now expected to sign it into law, despite firm opposition from China’s foreign ministry.

That gave rise to a serious bout of nerves in Asian trade, with major indexes in Japan, China and South Korea all trading in the red.

Hong Kong’s Hang Seng index was the worst performer with a fall of around 1.7 per cent.

Amid all that, Australian stocks declined sharply for the second straight day in morning trade.

However, there was a brief glimmer of hope by mid-afternoon as China’s vice premier, Liu He, said he was “cautiously optimistic” that the two sides could still reach an agreement on phase one of the trade negotiations.

After falling by as much as 1 per cent in the midday session, the ASX200 clawed back some losses before another selloff into the close.

The ASX Small Ords followed the big end of town higher, but was also losing momentum towards the end of the session.

The Australian dollar has fallen back below US68c and has now declined by around 2 per cent since the start of the month. Gold is holding steady at just above $US1,470 ($2,165) an ounce.

Looking ahead, the US S&P500 futures market is pointing around 0.4 per cent lower, in what could be a sign of lingering nervousness in markets this week.

While stocks have had a strong year amid another round of global monetary policy easing in central banks, this week’s price action is evidence that investors will need to stay vigilant around geo-political risks when managing their portfolios.