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Asian Stock Markets Soft After Beijing Financial Regulator Raises Bubble Specter

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Last updated: 03/02/2021 05:33:37

05:33 AM EST, 03/02/2021 (MT Newswires) -- Asian stock markets were soggy Tuesday after a powerful Beijing financial regulator posited that overvalued asset markets internationally and domestically were ripe for reverses. Guo Shuqing, chair of the China Banking and Insurance Regulatory Commission, told a press briefing that bubbles in international stock markets might burst and that it was risky to speculate on China properties, which have been boosted by easy central-bank money.

Hong Kong, Shanghai and Tokyo fell back, as did other regional exchanges. Seoul managed a gain, but had been closed on Monday during global equity rallies.

In Japan, the Nikkei 225 opened higher but declined in trading, finishing down 0.9% as investors again booked profits in a market still trading near 30-year highs.

The Nikkei 225 fell 255.33 to 29,408.17, as losing issues outnumbered gainers 161 to 60. The benchmark index had risen 2.4% on Monday.

The Tokyo Stock Exchange REIT Index declined 0.1% on the day.

In economic news, Japan's unemployment rate in January dropped to 2.9% from 3.0% in December, reported the Statistics Bureau. There were 110 job openings for every job hunter in the month.

Also, business capital spending fell 4.8% in Q4 year-over-year, the third-straight quarter of declining business capital outlays, reported the Ministry of Finance (MOF). Ordinary corporate profits in Japan slipped 0.7% in Q4 year-over-year, extending the picture of shrinking profits to the seventh straight quarter, reported the MOF.

The Hong Kong Hang Seng Index opened higher but declined in trading, finishing off 1.2%.

The broad-gauge Hang Seng fell 356.71 to 29,095.86, as losing issues outnumbered gainers 43 to nine.

The Hang Seng TECH Index slipped 0.4% on the day.

On the mainland, the Shanghai Composite fell 1.2% to 3,508.59.

In other news, the prominent Hong Kong stock-market index compiler Hang Seng Indexes announced a planned overhaul to include more high-tech companies in its benchmark Hong Kong Hang Seng Index.

The compiler will raise the number of benchmark constituent stocks to 80 in 2022 from current 55, and then to 100 total at an undefined future date. The effect may be to dilute demand for "old-economy stocks" in the famed index, due to the fact that index-fund investing, such as by exchange-traded funds, or ETFs, will be spread out among more issues, said analysts.

On the other exchanges, the S. Korean Kospi rose 1.0%; the Taiwan TWSE was flat; the Australian ASX 200 declined 0.4%; the Singapore Straits Times Index was steady, and the Thai Set inclined 0.2%. In late trading in Mumbai, the Sensex was up 0.9%.

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