SINGAPORE — Shares in the Asia-Pacific region were mixed in Tuesday’s trading as investors watched the market reaction to the People’s Bank of China’s announcement of financial support for Covid-hit sectors.
Hong Kong’s Hang Seng index led losses among the region’s major markets as it fell about 2.4%, resuming trading after the holiday on Friday and Monday.
Chinese tech stocks in the city plummeted after authorities in China announced Friday a ban on live streaming of unauthorized video games. In Tuesday afternoon’s trading, shares of Bilibili plunged 10.73%, while NetEase fell 3.46%. Tencent was also down 2.99% and Alibaba was down 4.03%. The Hang Seng Tech Index traded 3.88% lower.
The Hong Kong market is expected to remain volatile as earnings “remain under downward pressure,” Bank of America Securities’ Winnie Wu told CNBC’s Street Signs Asia on Tuesday.
Hong Kong’s economy is also closely linked to mainland China, said Wu, China equity strategist at the firm.
“We are very concerned about China’s economy under this zero-Covid policy,” she said. Mainland China has been grappling with its worst Covid outbreak since the pandemic’s early stages in 2020 for weeks.
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Mainland China stocks struggled for gains in Tuesday’s trading, with the Shanghai composite slipping 0.38% while the Shenzhen component fell 0.726%.
On Monday, the People’s Bank of China announced it would increase financial support for industries, businesses and people affected by Covid-19.
The announcement came after China reported mixed economic data, with March retail sales falling short of expectations while first-quarter GDP came in higher than expected.
Elsewhere, the Nikkei 225 in Japan rose 0.69%, while the Topix index gained 0.83%. South Korea’s Kospi rose 0.9%.
In Australia, the S&P/ASX 200 gained 0.55%.
MSCI’s broadest index of Asia Pacific equities outside Japan traded 0.45% lower.
Dollar yen crosses 128
The Japanese yen continued to weaken against the greenback and last traded at 128.17 against the greenback. This compares to levels below 125.6 recorded against the dollar last week.
“Policy divergence between the US and Japan suggests more losses are on the horizon [the Japanese yen]’ said Carol Kong, senior associate in monetary strategy and international economics at the Commonwealth Bank of Australia.
The Japanese currency has been hit particularly hard in recent weeks as the Bank of Japan is expected to lag behind its peers such as the US Federal Reserve in normalizing monetary policy.
The US Dollar Index, which tracks the greenback against a basket of its peers, came in at 100.957 as it continues to climb after jumping below 100 last week.
The Australian dollar was at $0.7374, struggling to recover after falling from over $0.745 in the previous week of trading.
Oil prices were lower in the afternoon of the Asian session, with international benchmark Brent crude futures falling 0.23% to $112.90 a barrel. US crude futures were down 0.38% to $107.80 a barrel.