Embattled leader Carrie Lam said she would push ahead with the bill despite deep concerns across vast swaths of the Asian financial hub that triggered its biggest political demonstration in more than 15 years on Sunday.

In a rare move, prominent business leaders warned that pushing through the extradition law could undermine investor confidence in Hong Kong and erode its competitive advantages.

The extradition bill, which has generated unusually broad opposition at home and abroad, is due for a second round of debate on Wednesday in the city's 70-seat Legislative Council. The legislature is controlled by a pro-Beijing majority.

Britain handed Hong Kong back to China in 1997 under a "one-country, two-systems" formula, with guarantees that its autonomy and freedoms, including an independent justice system, would be protected.

But many accuse China of extensive meddling, denying democratic reforms, interfering with local elections and the disappearance of five Hong Kong-based booksellers, starting in 2015, who specialised in works critical of Chinese leaders.

Sunday's protests plunged Hong Kong into political crisis, just as months of pro-democracy "Occupy" demonstrations did in 2014, heaping pressure on Lam's administration and her official backers in Beijing.

She warned against any "radical actions", following clashes in the early hours of Monday between some protesters and police after Sunday's otherwise peaceful march.

Police erected metal barriers to secure the council building as a small number of protesters started to gather on Tuesday evening despite torrential rain and thunderstorm warnings.

Nearly 2000 mostly small retail shops, including restaurants, grocery, book and coffee shops, have announced plans to strike, according to an online survey, a rare move in the staunchly capitalist economy.

Human rights groups have repeatedly cited the alleged use of torture, arbitrary detentions, forced confessions and problems accessing lawyers in China, where the courts are controlled by the Communist Party, as reasons why the Hong Kong bill should not proceed.

The Catholic Diocese of Hong Kong called on the government not to pass the bill "hurriedly" and urged all Christians to pray for the former colony.

A Facebook post called on people to enjoy a picnic next to government offices on Wednesday, describing the area as "among the best picnic sites".

The post has attracted close to 10,000 responses from people promising to attend.

Beijing-based consultancy Gavecal said some bankers in Hong Kong were reporting that many mainland clients were shifting their accounts to Singapore, fearing they could come under scrutiny in the financial hub.

Australian Associated Press