Shanghai stocks dropped 5.8% Monday, permitting their biggest percentage drop so far this year, as lower commodity prices, persistent worries over tightening in bank loans and weak economic data dampened investor sentiment.
Hong Kong shares were also weighted down by the performance as well as a steep fall in U.S. stock futures and commodity prices. In Tokyo, exporters were dragged down by the yen’s strength as risk averse investors bought the low-yielding currency in search of a perceived safe haven.
“The U.S. fall on Friday helped to reduce the risk appetite for speculators holding Asian assets, said Ben Collett, head of cash equities at TFS Derivatives. He added, “What we’re seeing is guys getting a little risk averse and cutting their losses.”
China’s Shanghai Composite index explained its biggest percentage drop since November and ended at 2,870.63, its first close below 3,000 since the end of June.

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