Hong Kong - Asian markets mostly retreated Monday following losses on Wall Street as fears over Greece returned, while Shanghai and Hong Kong tumbled after Chinese authorities unveiled restrictions on dealers borrowing cash to trade shares.
The mainland clampdown, announced Friday, offset news at the weekend that the Chinese central bank had reduced the amount of cash which banks must keep in reserve -- a bid to boost loan activity.
Shanghai sank 1.64 percent, or 70.22 points, to 4,217.08 and Hong Kong fell 2.02 percent, or 558.19 points, to 27,094.93. Sydney shed 0.76 percent, or 44.8 points, to close at 5,833.1.
Tokyo was marginally lower, easing 18.39 points to 19,634.49, but Seoul closed 0.15 percent higher, adding 3.21 points to 2,146.71.
The People's Bank of China Sunday announced it would cut one percentage point off the reserve ratio requirement, the second reduction this year and the latest monetary easing measure aimed at kick-starting growth in the world's number-two economy.
It has also cut interest rates twice since November.
However, on Friday the China Securities Regulatory Commission announced tighter rules on margin trading -- where investors buy shares mostly with borrowed money -- which has helped propel the recent rally.
At the same time authorities made it easier to short-sell, or bet against stocks.
The Hong Kong and Shanghai share markets have been soaring as investors speculate that Chinese leaders will continue to loosen monetary policy to counter a sharp slowdown.
"Investors are taking profits in China," said Jonathan Ravelas, chief market strategist at Manila-based BDO Unibank.
"The clampdown initiated by securities regulators is adding to the sell-off and the weak investor sentiment is spreading to other markets in the region," he told Bloomberg News.
Shanghai has more than doubled over the past year, while Hong Kong has surged about 18 percent this year.
On Wall Street Friday the Dow sank 1.54 percent, the S&P 500 fell 1.13 percent and the Nasdaq dropped 1.52 percent on fears about Greece's future in the euro zone as it struggles to secure the release of much-needed bailout cash.
AFP
