Asian shares slip on report of more US sanctions on China

Shares were mostly lower in Asia on Monday following a report that the U.S. is preparing to slap sanctions on a dozen more Chinese officials, ratcheting up tensions with Beijing.

Benchmarks dropped in Tokyo, Hong Kong and Shanghai but rose in Sydney.

Investors also are locking in recent gains after markets surged with signs of progress toward rolling out coronavirus vaccines in many countries.

Stocks hit record highs on Wall Street on Friday as traders took a discouraging jobs report as a sign that Congress may finally move on delivering more aid for the pandemic-stricken economy.

After a strong start, Asian shares fell back, especially in China. Hong Kong's Hang Seng dropped 1.7% to 26,382.06 and the Nikkei 225 in Tokyo lost 0.8% to 26,553.85. The Shanghai Composite index sank 0.7% to 3,421.85.

South Korea's Kospi was almost unchanged, at 2,732.38 and in Australia, the S&P/ASX 200 added 0.4% to 6,662.70.

A report by Reuters citing unnamed sources said the U.S. departments of State and Treasury were preparing economic sanctions on a dozen more Chinese official in response to Beijing's crackdown on dissent in Hong Kong.

That followed a tightening of visa restrictions on Chinese Communist Party members and their families announced late last week as tattered relations between Washington and Beijing fray further.

The decision to limit such people to one-month, single entry visas drew an accusation that the U.S. was escalating “political suppression" against China.

Wall Street closed out a solid week for stocks Friday with more record highs as traders took a discouraging jobs report as a sign that Congress will finally move to deliver more aid for the pandemic-stricken economy.

The S&P 500 rose 0.9% to 3,699.12, notching its third all-time high this week. The...