By Kenan Machado
As a number of Asian stock markets rose Tuesday, investors continued to fret about China's efforts to curb speculative fervor.
While the country's economy appears solid, highlighted by Monday's report that gross domestic product rose 6.9% in the first quarter, market players have been doing their share of worrying.
Chinese equities have pulled back of late for reasons including the top securities regulator's urging exchanges to strengthen rules and severely punish violations. That as China's top insurance regulator faces a graft probe and after months of a government clampdown on speculative trading by insurance companies that sell annuities to clients while promising market-beating results from investments in stocks.
The Shanghai Composite Index fell a combined 1.6% on Friday and Monday, its largest two-session drop since December, and was down slightly further Tuesday. Some two dozen companies were down by the 10% daily limit in morning action, versus more than 100 Monday.
Shares in Hong Kong, where markets reopened Tuesday after a four-day Easter weekend, were down 0.9% in what Castor Pang, head of research at Core Pacific-Yamaichi International in Hong Kong, called a catch-up move to mainland selling.
Steel and iron-ore futures--which hit 4-year highs last month--fell sharply again in China, where iron-ore imports and steel production of late have outpaced physical demand and where the government is trying to cool a housing bubble.
Recent steps on the real-estate front seem to have lost their effectiveness. Data released Tuesday showed that prices in 70 major cities collectively rose at their fastest month-over-month pace since October, when the government first sought to rein in speculation.
The iron-ore slump is weighing on Australia's benchmark stock index, which is heavily weighted toward mining. Fortescue skidded 6.3% Tuesday, bringing April's slide to 17%, while BHP Billiton and Rio Tinto fell nearly 2%. Australia's stock market is also coming off a four-day weekend.
The S&P/ASX 200 was Tuesday's worst-performing Asia Pacific stock index, dropping 1%, weighed down not just by the miners but by banking stocks. They hit session lows after the minutes of this month's central-bank meeting raised some concern about the state of Australia's economy--notably on the labor front.
The market clouds originating from China overshadowed largely modest gains in other Asian stocks, which benefited from a sentiment boost courtesy of overnight strength on Wall Street. The Nikkei rose 0.2% while Korea's Kospi added 0.1%.
John Wu contributed to this article.
Write to Kenan Machado at firstname.lastname@example.org
(END) Dow Jones Newswires
April 18, 2017 01:43 ET (05:43 GMT)
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