Hong Kong tech stocks drag market down 2%; Asia markets drop

This is CNBC's live blog covering Asia-Pacific markets.

The Chinese and Hong Kong flags flutter as screens display the Hang Seng Index outside the Exchange Square complex, which houses the Hong Kong Stock Exchange, on January 21, 2021 in Hong Kong, China.
Zhang Wei | China News Service via Getty Images

Shares in the Asia-Pacific fell on Monday, with Hong Kong's Hang Seng leading losses as Chinese chip stocks listed in the city plunged following new export rules from the U.S.

China's largest chipmaker Semiconductor Manufacturing International Corporation fell as much as 5.23%, while Hua Hong Semiconductor dropped more than 10% and Shanghai Fudan Microelectronics Company plunged as low as 24.6% during morning trade.

The broader Hang Seng index was 2.95% lower at 17,216.66, with the Hang Seng Tech index down 3.98%. HSI heavyweight Meituan fell 6.71%.

In mainland China, the Shanghai Composite lost 1.66% to 2,974.15 on its first day of trade after the Golden Week holiday, while the Shenzhen Component dropped 2.38% to 10,522.12. The CSI 300 index, which tracks the largest mainland-listed stocks, slipped 2.21% to 3,720.94.

The S&P/ASX 200 was 1.62% lower at 6,667.80. MSCI's broadest index of Asia-Pacific shares outside Japan traded 1.88% lower. Markets in Japan, South Korea, Taiwan and Malaysia are closed for holidays Monday.

Later this week, the Bank of Korea will announce its benchmark interest rate decision, Singapore is set to announce its GDP estimate for the third quarter and China releases inflation data.

Taiwan Semiconductor Manufacturing Company and Japan's Fast Retailing will report earnings and the U.S. will release inflation data for September.

On Friday in the U.S., major stock indexes dropped more than 2% after data showed the unemployment rate declined in September, sparking fear that the Federal Reserve would continue hiking rates aggressively.

There's 'significant upside' for India's housing market, says real estate firm

India's property market has a lot of growth ahead, says real estate firm
India's property market has a lot of growth ahead, says real estate firm

Prices of residential property in India have room to rise, according to Abhishek Lodha, CEO of Lodha Group, an India-headquartered multinational real estate company.

"We do think that the Indian property market is at the start of a long term upside," he said.

Lodha acknowledged that India's property housing market suffered a slowdown between 2015 and 2020, but said there is "a lot of growth ahead" given India's demographics, income growth, and where mortgage rates are.

"There may be some aberrations as we deal with the global economy. But in general, the Indian housing market set for a fairly significant upside," he said.

— Lee Ying Shan

Australian dollar falls to weakest levels since April 2020

The Australian dollar weakened sharply in Asia's afternoon trade, falling as low as $0.6321, to levels not seen since April 2020.

The currency could weaken even further below $0.62 this week, according to Carol Kong, associate director for international economics and currency strategy at Commonwealth Bank.

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She said in a note that the divergence in the Australian and U.S. economies is playing out in interest rate differentials and weighing on the Australian currency. Last week, the Reserve Bank of Australia increased rates by 25 basis points, less than the expected 50 basis point hike.

"The weakness in commodity prices and pick up in volatility is compounding AUD's woes," Kong added.

— Abigail Ng

Hong Kong shares of Chinese chipmaker SMIC drop 5% after U.S. export controls take effect

Shares of China’s biggest chipmaker SMIC fell after Washington announced new export controls that will limit Beijing's ability to buy and manufacture high-end chips used in military equipment.

SMIC's stock fell as much as 5.23% before recovering slightly. It last traded 2.91% lower.

Foreign Ministry Spokesperson Mao Ning said in a press conference on Saturday that the U.S. has been "abusing export control measures to wantonly block and hobble Chinese enterprises. Such practice runs counter to the principle of fair competition and international trade rules."

— Abigail Ng

CNBC Pro: Porsche is now more valuable than VW: Here's what the pros think of the carmakers

A week after its stock market debut, luxury automaker Porsche's market cap raced past its former parent company Volkswagen Group's.

Some fund managers are already comparing the German firm to Tesla, the largest electric carmaker in the world, saying Porsche's electrification plan for its hot-selling Macan EV is expected to be an instant success.

Compared to its parent company VW, which makes nearly 10 million cars annually, Porsche manufactures just over 300,000 cars but accounts for a quarter of the profits at Volkswagen.

CNBC Pro subscribers can read more here.

— Ganesh Rao

Currency check: South Korean won weakens against the U.S. dollar

The Korean won were among those losing ground against the U.S. dollar in Asia's morning trade.

The South Korean currency last changed hands at 1,427.76 per dollar after strengthening below the 1,400 level last week.

Japan's yen weakened slightly to 145.46 against the greenback, while the Australian dollar strengthened to $0.6370.

The offshore Chinese yuan hovered around 7.1319 per dollar.

— Abigail Ng

CNBC Pro: Goldman says these 'cheap' global stocks are set to win in the short and long-term

As Europe struggles with soaring electricity and gas bills, Goldman Sachs says global companies focussing on energy efficiency are set to outperform.

"We think Energy Efficiency companies can outperform over the short term, with the focus on energy efficiency to tackle the current energy crisis that followed the Russian invasion of Ukraine," the analysts wrote in a note on Oct. 3.

"[And] over the long term, with the focus on energy efficiency to tackle the climate change and reach the ambitious 'net zero' targets."

CNBC Pro subscribers can read more here.

— Weizhen Tan

Services activity in China contracted in September, private survey shows

The Caixin services purchasing managers' index came in at 49.3 in September, according to a report published Saturday, a steep drop from 55 in August.

The 50-point mark separates growth from contraction. PMI readings compare activity from month to month.

The nation's Covid curbs caused services activity in China to contract in September for the first time since May, the report said.

"Companies that reported reduced activity frequently commented that the pandemic and subsequent measures to contain the virus had restricted operations and weighed on demand in September," the press release by Caixin said.

— Abigail Ng