Beijing, China (BBN)-China’s main share index closed down by more than 5 per cent after several major brokerage firms announced they were under investigation.
China’s Shanghai Composite index ended the day 5.5 per cent lower at 3,436.3, reports BBC.
Late on Thursday, it was announced that China’s securities regulator was investigating one of the country’s largest brokerage firms, Citic.
The firm is being probed over possibly breaking of securities market rules.
Rival brokerage Guosen Securities is also being investigated, and shares in both Citic and Guosen fell by 10 per cent, the maximum allowed in one day.
In addition, trading in China Haitong Securities was halted earlier on Friday as some reports indicated that the firm was also under investigation.
Chen Xingyu, an analyst at Phillip Securities, told the AFP news agency: “The biggest reason for such a sudden drop today is because of regulator’s investigation of the top brokers. It has triggered a broader sell-off.”
In Hong Kong, the Hang Seng benchmark index was down 1.4 per cent at 22,156.97.
In Japan, the benchmark Nikkei 225 index closed down 0.3 per cent at 19,883.94.
Data released on Friday showed the country’s core consumer prices index (CPI) recorded its third straight month of falls – down 0.1 per cent in October from a year earlier.
Household spending in the country fell 2.4 per cent during the period.
On a brighter note, jobs numbers indicated the country’s jobless rate may fall in the near future.
“Taking the labour market first, the unemployment rate fell from 3.4% to a twenty-year low of 3.1%… [which] suggests that the jobless rate may drop below 3% in coming months,” said Japan economist Marcel Theiliant.
“However, today’s other data were rather disappointing,” he said. “Core household spending dipped by 0.4 per cent month on month in October following a 1.8 per cent month-on-month decline in September.
In South Korea, the Kospi share index closed down 0.08 per cent at 2,028.99.
Australia’s S&P/ASX 200 ended the day 0.2 per cent lower at 5,202.60.
Sydney-listed shares of mining giant BHP Billiton closed down 0.9 per cent.
On Thursday, the United Nations said the dam burst at the Samarco mine in Brazil earlier this month had unleashed a flood equivalent to “20,000 Olympic swimming pools of toxic mud”.
The dam is a joint venture between BHP and Vale. However, BHP has said the mud spilled was not toxic.