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Asian Equities Mixed; Chinese Investors Back to Dumping Hong Kong Stocks

Asian markets were mixed in afternoon trade - Asian markets were mixed in afternoon trade on Wednesday, while reports that Chinese investors are back to selling Hong Kong stocks received some focus.

Mainland investors have sold around $3.2 billion of Hong Kong equities in August so far, marking the largest monthly selling figure since China launched its first exchange link with the city in 2014, Bloomberg reported on Wednesday citing daily turnover data.

Internet giant Tencent Holdings Ltd (HK:0700) accounted for over half of the sales as its stocks lost 13% in a five-day slump earlier this month after the company surprised investors with a profit decline.

The fall in stock prices came after regulators banned the sale of blockbuster game “Monster Hunter: World” on Tencent’s WeGame platform just days after its release, citing large number of complaints about its content. Analysts earlier predicted the game to be one of the company’s biggest sellers.

The report cited the escalating U.S.-China trade tensions as headwind for local stocks, while deleveraging measures and the yuan’s weakness also put pressure on markets.

The Shanghai Composite and the Shenzhen Component were 0.3% and 0.7% lower by 1:53AM ET (05:53 GMT). Hong Kong’s Hang Seng Index was up 0.1%.

China’s state planner He Lifeng said on Wednesday that the country could face increased risk in the second half of the year and urged policymakers to step up their efforts to achieve economic goals.

Meanwhile, Japan’s Nikkei 225 inched up 0.1%. Data from Japan Exchange Group revealed that foreigners have sold a net 3.9 trillion yen ($34.7 billion) in Japanese stocks so far this year, on course to be the largest annual selloff since 1987. The benchmark Topix index is down 5% this year and is one of the worst performances among developed markets, Bloomberg reported.

“The markets are reflecting very low interest rates supporting asset prices and undoubtedly in some parts very good profits,” William Low, head of global equities at Nikko Asset Management Europe, said in an interview with Bloomberg. Investors “are beginning to question where sustainable growth is going to be coming from rather than having excessive expectations on cyclical growth,” he added.

Down under, Australia’s S&P/ASX 200 traded 0.7% higher, while South Korea’s KOSPI was also up 0.2%.

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