Asian shares were set for their worst day in two weeks on Thursday, weighed down by the latest regulatory crackdown in China and global investors worries’ about a looming reduction in central bank stimulus, while the dollar held firm.
Shares of Tencent and Netease in Hong Kong dropped 5.7% and 6.98% respectively by Thursday afternoon in the city, after Chinese state media reported that the two were among video game firms summoned to a meeting with regulators.
Issues discussed during the meeting included requiring firms to limit the gaming time for minors, as well as to forbid any form of “account renting services” for minors. New rules were published late August banning those under 18 years old in China from playing online games for more than three hours per week.
Private education stocks also took a hit following China’s Wednesday ban on private tutors giving classes online or in unregistered venues. New Oriental Education & Technology’s stock plunged 6.67%, while smaller rival Koolearn Technology fell 5.18%.
Meanwhile, shares of China Evergrande Group in Hong Kong plunged more than 9% as uncertainty continues to surround the embattled property developer’s debt situation.
The broader Hang Seng index in Hong Kong dropped 1.6%.
The Shanghai composite in mainland China hovered fractionally higher while the Shenzhen component dipped 0.628%.
China’s consumer price index rose 0.8% year-on-year in August, compared to expectations for a 1% increase in a Reuters poll. Meanwhile, the producer price index jumped 9.5% from a year ago, as compared to forecasts of a 9% rise in a Reuters poll.
Elsewhere, the Nikkei 225 in Japan dipped 0.46% while the Topix index fell 0.48%. South Korea’s Kospi declined 0.9%.
In Australia, the S&P/ASX 200 fell 1.41%.
MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 1.21%.
· EMERGING MARKETS-Malaysia shares weaken ahead of c.bank rate decision
Malaysian shares dropped nearly 1% on
Thursday ahead of a central bank meeting at which it is expected
to hold interest rates, while South Korean shares eyed their
worst day in three weeks after policymakers there hinted at
further tightening.
The pan-European Stoxx 600 fell 0.7% in early trade, with travel and leisure stocks shedding 1.8% to lead losses as all sectors and major bourses slid into negative territory.
All eyes are on the ECB on Thursday, with market players keen to hear the bank’s outlook on inflation, interest rates and hints on when it might start tapering its massive asset-purchase program despite uncertainty over economic growth and Covid.
The ECB announces its latest monetary policy decision at 12:45 p.m. London time and holds a press conference shortly afterward.
Reference: CNBC, Reuters
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