HONG KONG, Nov 17, 2025 (BSS/AFP) - Asian markets were mixed Monday amid simmering concerns that the Federal Reserve will not cut interest rates as hoped next month, while fears of a bubble continue to weigh on sentiment. The tepid mood on trading floors also dragged on the crypto sector, with bitcoin briefly erasing all its gains this year -- just over a month after hitting a record high. Meanwhile, simmering tensions between China and Japan hit tourism and retail firms on Tokyo's exchange. Stocks have enjoyed a healthy rally since their tariff-fuelled swoon in April, with tech firms leading the way as companies pumped eye-watering amounts of cash into all things linked to artificial intelligence. That has been compounded by a weakening US jobs market that has fanned expectations the Fed will cut rates. However, the gains have petered out in recent weeks as investors re-evaluate those two pillars. Fed boss Jerome Powell said a third-straight reduction in borrowing costs was not certain next month, while other officials have hinted they intend to stand pat. The decision makers said they were concerned that inflation remained stubbornly anchored above the bank's two percent target, overshadowing labour market fears. Traders are keenly awaiting the release of several reports -- including on jobs and inflation -- that had been held up by the record government shutdown that ended last week. The winding back of rate cut bets comes amid growing unease about the sky-high valuations in the tech sector and warnings that a bubble has formed that could soon burst. All eyes are on this week's release of earnings from chip titan Nvidia, which this month became the first $5 trillion company. "Nvidia has been partly responsible for powering the AI rally, but is now facing pressure amid concerns about stretched valuations in the sector," wrote Fiona Cincotta, senior market analyst at City Index. "Worries about an AI bubble have weighed on the sector, and investors are questioning not only the amount of money companies are spending on the tech relative to the returns they're seeing, but also the circular nature of the spending." After a tepid lead from Wall Street, Asian markets fluctuated. Hong Kong, Shanghai and Singapore all dropped, though Seoul, Manila, Bangkok, Wellington and Taipei advanced. Sydney was barely moved. Tokyo also sank as figures showed Japan's economy shrank 0.4 percent in the three months to September. Tourism and retail firms were among the worst hit after China advised its citizens not to travel to Japan amid a diplomatic spat over comments by Prime Minister Sanae Takaichi about Taiwan. Cosmetics firm Shiseido dived more than nine percent, department store group Takashimaya nearly six five percent and Fast Retailing -- the owner of Uniqlo -- shed 4.8 percent. Department store group Mitsukoshi fell 11.3 percent and Pan Pacific, behind discount retail chain and tourist magnet Don Quijote, slid 5.3 percent. Japan Airlines gave up 3.4 percent. China is the biggest source of tourists to Japan. Takaichi's comments earlier this month were widely interpreted as implying an attack on Taiwan could warrant Tokyo's military support. If a Taiwan emergency entails "battleships and the use of force, then that could constitute a situation threatening the survival (of Japan), any way you slice it", she told parliament. The two sides last week summoned each other's ambassadors, with China then telling its citizens to avoid travelling to Japan. Bitcoin was also suffering from the uncertain climate on trading floors, with the digital unit briefly dropping to $92,935.51 -- below the $93,714 mark it finished at on December 31 -- according to Bloomberg data. It bounced back slightly in the afternoon to sit above $95,000. The cryptocurrency hit a peak of $126,251 on October 6. Investors spend most of the year piling into bitcoin after Donald Trump returned to the White House pledging to deregulate the crypto sector. The president's embrace of digital assets has reversed years of US government scepticism towards the industry, with the US House of Representatives passing three landmark cryptocurrency bills in July. - Key figures at around 0705 GMT - Tokyo - Nikkei 225: DOWN 0.1 percent at 50,323.91 (close) Hong Kong - Hang Seng Index: DOWN 1.0 percent at 26,312.44 Shanghai - Composite: DOWN 0.5 percent at 3,972.03 (close) Dollar/yen: UP at 154.68 yen from 154.55 yen on Friday Euro/dollar: DOWN at $1.1603 from $1.1621 Pound/dollar: DOWN at $1.3148 from $1.3171 Euro/pound: UP at 88.26 pence from 88.22 pence West Texas Intermediate: DOWN 1.1 percent at $59.46 per barrel Brent North Sea Crude: DOWN 1.0 percent at $63.78 per barrel New York - Dow: DOWN 0.7 percent at 47,147.48 (close)