Chinese stocks suffered sharp declines on Tuesday, with property developers tumbling on further tightening measures targeting the sector, while coal and metal shares fell on concerns about price curbs.
The drop in Shanghai triggered an afternoon selloff in other Asian markets, with Hong Kong stocks posting big losses.
Shanghai’s CSI 300 Index dropped 145.35 points, or 4.4%, to close at 3,169.54.
Chinese property stocks fell sharply after Beijing on Monday announced new limits on the ability of foreigners to buy residential or commercial property.
Poly Real Estate Group Co. lost 5.5% in Shanghai and China Vanke Co. shed 4.3% in Shenzhen.
Among Chinese developers traded in Hong Kong, China Overseas Land & Investment fell 2.5% and Shimao Property Holdings fell 2.4%.
Chinese refining, coal and metal stocks stumbled after the China Securities Journal, citing unnamed sources, reported that the country might unveil a set of measures in the near term to control rising prices
Refiners lost heavily, with China Petroleum & Chemical Corp., or Sinopec, declining 5.3% and heavyweight PetroChina Co. sliding 6.5% in Shanghai.
Bucking the downward trend in Hong Kong, Cathay Pacific Airways Ltd. jumped 3.4% after it forecast 2010 net profit to more than double amid a robust recovery in demand for passenger and cargo services in the Asia-Pacific region.
In Seoul, the market was hurt by the Bank of Korea’s decision to hike its policy rate by a quarter-point to 2.50%, as the central bank resumed its monetary-tightening campaign.
Korea’s Kospi Index slid 14.68 points, or 0.8%, to 1,899.13.
Also in Seoul, Samsung Heavy Industries fell 3.8%, LG Electronics dropped 1.8% and LG Display declined 1.4%.
Hyundai Engineering & Construction slumped 14.9%. Hyundai Group was selected as the preferred bidder for a stake in the company, but concerns about Hyundai Group’s financial health sent stocks of affiliate companies sharply lower, with Hyundai Merchant Marine falling 15% and Hyundai Elevator losing 14.9%.
Hana Financial Group rose 2.7% after the Yonhap news agency reported Chief Executive Kim Jong-yeol as saying the group will make a final decision next week on whether to purchase a controlling stake in Korea Exchange Bank from Lone Star Funds.
In Japan, the Nikkei 225 Index fell 30.41 points, or 0.3%, to 9,797.10.
Hong Kong’s Hang Seng Index descended 334.16 points, or 1.4%, to 23,693.
In Tokyo, the U.S. dollar’s gains against the yen, which pushed the dollar to above the 83-yen level for the first time since early October, prompted some buying in exporters’ stocks.
Staying in Japan, Sony Corp. added 1.8%, Nintendo Co. rose 0.7% and Mazda Motor added 2.8%.
Elpida Memory Inc. advanced 1.5% after the Nikkei reported that the company will likely list depositary receipts on the Taiwan Stock Exchange as early as the current year ending March 2011, becoming the first Japanese company to list securities there.
In Sydney, Australia & New Zealand Banking Group shares rose 0.6% on the Lone Star news, reflecting relief the lender won’t need to go to market to raise capital to fund the acquisition.
In foreign-exchange markets, the euro recovered a little after falling sharply against the dollar on Monday as investors continued to fret about the debt problems in the eurozone.
The single currency was at $1.3606 against the dollar, from $1.3587 late in New York on Monday, and at ¥113.17 from ¥113.00. The dollar was fetching ¥83.18 from ¥83.17.
In other markets
Singapore’s Straits Times Index shed 24.70 points, or 0.8%, to 3,212.10.
Taiwan’s Taiex Index actually gained 71.56 points, or 0.9%, to 8,312.21
New Zealand’s NZX 50 Index dipped 13.17 points, or 0.4%, to 3,315.06
Australia’s S&P/ASX 200 Index gained back 12.30 points, or 0.3%, to 4,700.30
