Asia Markets: Asian markets extend slump as Hong Kong stocks sink toward new 14-month low

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Asian stock markets slumped in early trading Wednesday as trade tensions rose following a report that China is seeking permission from the World Trade Organization to impose sanctions against the U.S., separate from the tariff battle between the world’s largest economic powers.

The declines continued for Hong Kong stocks, which hit 14-month lows Tuesday and saw the Hang Seng Index HSI, -0.44%   enter bear-market territory. It was off a further 0.5% Wednesday, headed toward its sixth straight decline. Chinese bank stocks were lower, as were Macau casino names. Sino Biopharma 2922, -10.16%   and knitwear maker Shenzhou 2313, -1.78%  , which joined the Hang Seng on Monday, were on an early pace for a third day of declines. Tech giant Tencent 0700, +0.52%   gave up early gains after fresh stock-buyback activity Tuesday.

Chinese equities fell as well. The Shanghai Composite SHCOMP, -0.33%   was off 0.5% after two days of declines, with financials leading this morning’s drop. But energy names provided support after the overnight jump in oil prices. The Shenzhen Composite 399106, -0.15%   was down 0.3%.

Japan’s Nikkei NIK, -0.53%   dropped 0.5%, despite further easing of the yen USDJPY, -0.13%  . Korea’s Kospi SEU, -0.30%   was off 0.2% and Australia’s benchmark XJO, -0.09%  as essentially flat after breaking an eight-day losing streak Tuesday. New Zealand’s NZX 50 NZ50GR, -0.56%  , which bounced 2% Tuesday to be the region’s best performer, was down 0.4%.

Benchmarks in Taiwan Y9999, -0.53%   and Malaysia FBMKLCI, -0.74%  , which resumed trading after a four-day weekend, sank, while Singapore’s Strait Times Index STI, -0.16%   was about flat.

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