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HONG KONG: Markets in Asia mostly fell Monday morning, led by Hong Kong after Beijing at the weekend further cracked down on China’s tech firms, while education companies were hammered as the government unveiled sweeping reforms of the sector. The broad losses across the region came as traders continued to fret over the fast spread of the Delta coronavirus variant, which has sent infections spiking and forced some governments to reimpose economically painful lockdowns or other containment measures. The selling extended from Friday, despite a strong lead from Wall Street, where all three main indexes ended at record highs with the Dow ending above 35,000 for the first time. Investors have a packed agenda of possible market-moving events this week including the Federal Reserve’s latest policy meeting, US economic growth data, and earnings from some of the world’s biggest firms such as Apple and Amazon.

They will also be keeping tabs on a meeting between US Deputy Secretary of State Wendy Sherman and Chinese Foreign Minister Wang Yi later in the day, the highest-level visit by the Biden administration.

The talks come at a time of increasingly strained relations between the superpowers, which have cracked heads over a range of issues including technology, Hong Kong and human rights.

Hong Kong sank more than four percent with education companies battered after China on Saturday unveiled reforms that will massively change the way they do business.

Beijing said the sector had been “hijacked by capital”, adding that it would prevent firms that teach school curriculums from making a profit, raising capital or going public.

China’s private education sector was worth $260 billion in 2018 according to consultancy and research firm L.E.K. Consulting, driven by a hyper-competitive kindergarten-to-university education system in oversubscribed cities.

JP Morgan Chase analysts said it was uncertain whether firms could continue to be traded on stock markets under the new regime, adding that “in our view, this makes these stocks virtually un-investable”.

New Oriental Education & Technology Group lost almost half its value in Hong Kong, having dived 41 percent Friday as speculation about the move circulated on social media. Its New York-listed shares collapsed 54 percent.

Koolearn Technology dived about a third and China Maple Leaf Educational Systems shed about 10 percent.

Tech firms also took a hit in response to Beijing’s latest moves against the sector as it told Tencent to relinquish its exclusive music label rights, saying the firm had violated antitrust laws.

Tencent bought a majority stake in rival China Music Group in 2016, effectively controlling more than 80 percent of exclusively held music streaming rights domestically, the State Administration for Market Regulation said in a statement.

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