By Colin Ng And Matthew Allen
Most Asian equity markets declined Tuesday, with Chinese property developers skidding lower on concerns Beijing may initiate more measures to cool property prices, while Japanese shares were pulled lower by selling in stocks that went ex-dividend.
The day began on a weak note as investors followed Wall Street's lead and took cash off the table after recent gains.
"We are seeing some softness, but certainly nothing of any conviction. Stocks that have run quite well over recent weeks are having a bit of a breather today," said Helen Spencer , client adviser at Macquarie Private Wealth.
The Nikkei Stock Average fell 1.1% to 9495.76 in Tokyo, and Hong Kong's Hang Seng Index declined 1% to 22109.95 after rising in 16 of the previous 18 sessions.
Persistent talk that Beijing may introduce more restrictive policies to make housing more affordable hurt property developers and banks. China Vanke /zigman2/quotes/205643772/delayed CN:000002 +0.67% slid 2.8% in Shenzhen, while China Merchants Bank /zigman2/quotes/210188047/delayed CN:600036 +1.27% shed 1.8% and Beijing Vantone Real Estate /zigman2/quotes/209732557/delayed CN:600246 +0.18% shed 3.3% in Shanghai. In Hong Kong, China Resources Land /zigman2/quotes/202417326/delayed HK:1109 -1.25% shed 3%, Shimao Property Holdings /zigman2/quotes/208719072/delayed HK:813 -0.36% gave up 2.1% and Bank of Communications /zigman2/quotes/203442771/delayed HK:3328 -0.19% dropped 1.8%.
"Investors are trading cautiously in the face of several large uncertainties on policies for real-estate developers and banks," said Zhang Zhuo at Minsheng Securities.
In Hong Kong, the Hang Seng Index appears "overdue" for a pullback, local brokerage Taifook said. It said a correction in local property stocks "looks more imminent" given that they have performed significantly better than the overall market recently, especially because a policy address by the territory's chief executive is planned for early October. The speech may include measures to cool the housing market. Sun Hung Kai Properties /zigman2/quotes/209086152/delayed HK:16 -1.13% fell 1.2% and Sino Land /zigman2/quotes/202960683/delayed HK:83 -0.91% lost 1.6%.
The Japanese market was weighed down by a large number of stocks—those with end-September fiscal half-years—trading ex-dividend, meaning the person who owned the stock on the date will be awarded the payment, regardless of who currently holds the stock. High-yielding pharmaceutical stocks underperformed the market. Eisai /zigman2/quotes/203064480/delayed JP:4523 +0.23% dropped 3.8% and Takeda Pharmaceutical /zigman2/quotes/201302442/delayed JP:4502 -1.00% lost 3.2%. Nomura Holdings /zigman2/quotes/206251373/delayed JP:8604 +1.20% shed 3.3%, NTT DoCoMo /zigman2/quotes/202061250/delayed JP:9437 -0.06% lost 2.5% and Inpex /zigman2/quotes/206689846/delayed JP:1605 +2.88% slid 2.2%.
Hyundai Motor fell 3.1% in Seoul. "The recent recall news of its Sonata sedans in the U.S. and its plan to acquire Hyundai Engineering & Construction may be pushing down shares of Hyundai Motor," said Bae Sung-young at Hyundai Securities.