Bei­jing halts stock sell- off

Townsville Bulletin - - NEWS -

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.

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