Asian Shares Sink As Jitters Over Chinese Markets Spur Selling

Shares fell on Tuesday in Asia, with Hong Kong's benchmark down nearly 2%, as jitters over Chinese markets dimmed confidence across the region.

Hong Kong's Hang Seng shed 1.9% to 15,905.80 while the Shanghai Composite index recovered from early losses, adding 0.3% to 2,893.99. I Photo: Scott Brown Flickr

US markets were closed on Monday, leaving investors without cues from overnight trading.

Early Tuesday, the future for the S&P 500 was 0.4% lower, and that for the Dow Jones Industrial Average was down 0.3%, as reported by Elaine Kurtenbach for the Associated Press (AP).

Tokyo's Nikkei 225 index fell, snapping a New Year's winning streak that took it to its highest level in 34 years. It lost 0.8% to 35,619.18.

The dollar weakened against the Japanese yen even as a former central bank official said that the Bank of Japan is preparing to end its longstanding negative interest rate policy.

 The dollar bought 146.12 yen, up from 145.75 late Monday and at its highest level in more than one month. Hong Kong's Hang Seng shed 1.9% to 15,905.80. The Shanghai Composite index recovered from early losses, adding 0.3% to 2,893.99.

The question of when and how the BOJ might extricate itself from more than a decade's worth of extreme monetary easing that has kept its benchmark rate at minus 0.1% has hung over the market for months.

Speculation over its game plan for changing its strategy has flared, especially after the Federal Reserve and other central banks hiked rates sharply to help snuff out inflation that soared as economies recovered from the shocks of the pandemic.

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