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Nikkei Markets

Asian stocks fall, dragged down by Hong Kong developers

South Korean equities extend losses to fourth day

HONG KONG (Nikkei Markets) -- Asian shares outside of Japan fell Monday, dragged down by Hong Kong property developers amid concerns over anti-extradition bill protests. South Korean equities extended losses.

The Nikkei Asia300 Index declined 0.7% to close at 1,309.68.

New World Development led Hong Kong real estate shares lower, tumbling 3.6%. Hang Lung Properties and Henderson Land Development dropped at least 2.6% each. A Hang Seng Index of Property Companies closed1.6% lower. New World signed an agreement with two units of Chow Tai Fook Enterprises to acquire the remaining 51% stake in Silvery Yield Development in a deal valued at 4.01 billion Chinese yuan ($582 million).

Hong Kong equities came under pressure on Monday after protests over a controversial extradition bill continued into the weekend. Activists, who are demanding the withdrawal of the bill, are campaigning against police response to recent demonstrations.

The Hang Seng Index closed 1% lower, its biggest decline in a week.

Meanwhile, South Korea's benchmark index fell for the fourth straight day, tumbling 1.8% to a two-month low. Shares were weighed by weak earnings, ongoing trade worries involving Japan, and renewed concerns over North Korea.

SK Innovation declined 2.3% after the South Korean oil refiner reportedly said its June quarter net profit declined 67% and operating income fell 42%. Samsung Heavy Industries gained 0.3% after the shipyard said its net loss in the April-June period widened from a year earlier.

Ssangyong Motor plunged 8% after its June quarter operating loss widened from a year earlier. Furniture maker Hanssem slumped 15.9% following a 53% decline in operating profit.

Investors' focus this week will be on the Federal Reserve meeting that begins on Tuesday and U.S.-China trade developments. The two nations will recommence talks in Shanghai on Tuesday almost three months after negotiations fell through, prompting the U.S. to increase tariffs on $200 billion of Chinese imports.

The Fed, meanwhile, is expected to cut interest for the first time in a decade. After Friday's better-than-expected June quarter U.S. GDP data, DBS Research said the case for a 50-basis-points rate cut by was "shot down" and that it expects a quarter percentage rate reduction.

In other movers on the A300, DBS Group Holdings closed 0.9% lower after rising earlier in the day. Southeast Asia's largest lender posted a 17% increase in second-quarter net profit, helped by an improvement in both interest and fee income.

Raffles Medical Group declined after the Singapore-listed healthcare provider reported a 15.7% fall in June quarter net profit.

ICICI Bank advanced 3.3% after the Indian lender reported a profit in the April-June period compared with a loss a year ago. Vedanta lost 5.1% after the Indian zinc miner said net profit in the same period declined 12% year-on-year.

--Nimesh Vora

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