Asian Equity Markets Trade Downward

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The Asian equity markets have mostly traded lower this week as investors’ concerns over the recent hawkish monetary policy decisions by the central banks weighed on sentiment. 

The equity markets are generally trading lower today, with the tech sector having an awful day. This is partially due to the Nasdaq composite index being down, while Chinese tech shares also fluctuate amid multiple headlines.

The United States Public Company Accounting Oversight Board (PCAOB) has secured complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong. This news is especially troubling for the tech companies traded on the Nasdaq, causing investors to become increasingly cautious.

This market volatility is primarily due to concerns over the slowing global economy and tensions between the US and China regarding trade negotiations.

In addition, China’s Annual Economic Work Conference will be held from December 15th-16th, and investors will be looking for any guidance on the potential pace of monetary tightening in the world’s second-largest economy.

The Biden administration also recently announced the “addition of 36 Chinese firms to the so-called entity list,” which forbids US businesses from exporting or transferring US goods and technologies to listed corporations without a license.

Meanwhile, China is pushing to finalise new regulations for some of the country’s biggest and most important industries. Reports claimed that “government efforts are now focused on tech, education, and healthcare issues.”

Nikkei 225, one of Japan’s major stock market indices, has recently announced that Fast Retailing’s stock split will see the company’s stocks divided into two separate shares. This means the company’s share prices will be halved in value, leading to a corresponding decrease in the Nikkei 225 index’s overall performance.

Overall, these concerns weighed on investor sentiment across the region and led to a mixed performance by equities.

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