Hong Kong Plunges on Tech Weakness

Shares in Hong Kong dropped sharply by the close on Monday, wiping out the Hang Seng index’s gains for 2021 once again as Chinese tech and education stocks plunged on regulatory pressure. Meanwhile, a summit between China and the United States got off to an acrimonious start, weighing on investor sentiment.

Japanese markets returned to trading Monday after a four-day long weekend, with the Nikkei 225 jumping 285.29 points, or 1%, to 27,833.29.

The Japanese yen traded at 110.18 per U.S. dollar, weaker than levels below 110 seen against the greenback last week.

In Hong Kong, the Hang Seng dumped 1,129.66 points, or 4.1%, to 26,192.32.

Hong Kong-listed shares of Chinese tech giant Tencent slipped 7.7% on Monday while Alibaba also dropped 6.4% and Meituan fell 13.8%. The
Those losses came after China’s antitrust regulator ordered Tencent to give up its exclusive music licensing rights and slapped a fine on it for anti-competitive behavior, marking yet another development in Beijing’s ongoing crackdown on its domestic internet titans.

Shares of private education firms listed in Hong Kong also tumbled as Chinese authorities also stepped up restrictions on the sector. New Oriental Education & Technology Group, Koolearn Technology and China Beststudy Education Group all saw their shares plummeting more than 30% each.

Singapore’s manufacturing output declined 3% in June on a seasonally adjusted, month-on-month basis, according to official data released Monday.

Investors likely continued to monitor the COVID situation in Asia as it weighs on sentiment.

In South Korea, the second highest level of virus restrictions will be applied to non-capital areas starting Tuesday, local agency Yonhap reported. Elsewhere, Tokyo’s daily coronavirus tally has exceeded 1,000 for six days in a row, according to Kyodo News.

The Australian dollar changed hands at $0.7335, above levels below $0.732 seen last week.

CHINA

In Shanghai, the CSI 300 lost 163.93 points, or 3.2%, to 4,925.30

Tensions between Washington and Beijing may have weighed on investor sentiment, as a high-level meeting between the two economic powerhouses got off to an acrimonious start.

China’s vice foreign minister said during Monday talks with the U.S. deputy secretary of state that the two countries’ relationship is “now in a stalemate and faces serious difficulties,” according to an English-language press release from China’s Ministry of Foreign Affairs.

In other markets

The Kospi index in Korea shed 29.47 points, or 0.9%, to 3,138.97.

In Taiwan, the Taiex index let go of 169.36 points, or 1%, to 17,403.56

In Singapore, the Straits Times Index fell 18.08 points, or 0.6%, to 3,138.97.

In New Zealand, the NZX 50 dropped 63.09 points, or 0.5%, to 12,673.23

In Australia, the ASX 200 slid 0.09 points to 7,394.27