Beijing halts stock sell- off
CHINESE stocks stormed into positive territory in volatile trading yesterday as Beijing launched new measures to halt a dramatic sell- off that has also hurt regional share markets and commodity prices.
The benchmark Shanghai Composite Index jumped 5.30 per cent, or 185.95 points, to 3,693.14, recovering from a 3.81 per cent fall in the morning.
The Shenzhen Composite Index, which tracks stocks on China’s second exchange, added 3.67 per cent, or 69.22 points, to 1,953.67.
“Investor confidence is recovering,” Central China Securities analyst Zhang Gang said.
“Government support policies have shifted from saving the bluechips and large cap stocks to focusing on growth stocks and smaller shares, which boosted trading volume and liquidity,” he said.
The gains came after China moved to stop major shareholders from selling shares and launched a probe into short- selling in a bid to calm markets.
The Shanghai index had fallen more than 30 per cent since a spectacular bull run peaked on June 12, driven lower by restrictions on margin trading, concerns about overvaluations and “panic” selling by the retail investors that make up the vast majority of the market.
Hong Kong stocks recorded their biggest single- day loss for more than six years on Wednesday as the market turmoil spread across the region but they were up more than three per cent by the break yesterday.
Tokyo stocks were down 0.69 per cent at the break, recouping earlier heavy falls. US shares retreated overnight on worries about how the stock market rout could affect the Chinese economy – the world’s secondlargest and a key driver of global growth – and worries of a messy Greek exit from the eurozone. The Dow Jones Industrial Average finished down 1.47 per cent. China’s market regulator ordered the stock sell- off halt on Wednesday.