Stocks fall sharply on economic worries

Chinese mainland stocks extended losses on Wednesday in a third straight day of declines, as worries over the country’s cooling economy and the yuan’s descent to a 15-month low knocked investor confidence.

The blue-chip CSI300 index fell 2.40 percent to 3,291.98 points, while the Shanghai Composite Index closed down 2.08 percent at 2,723.26 points.

The declines follow downbeat economic data reported on Tuesday, which comes as a trade war with the US threatens to pile more pressure on the world’s second-largest economy.

To support growth, authorities in Beijing has rolled out a $14 billion urban railway plan and pushed local governments to speed up issuance of special bonds for funding infrastructure projects. Official data on Tuesday showed that fixedasset investment expanded by a less-than-expected 5.5 percent in January-July.

Eyes are also on the Chinese yuan as the Turkish lira rout dampened appetite for emerging market currencies.

The yuan weakened to a 15-month low on Wednesday and flirted with a key support level not seen since 2008, as the dollar extended gains and a raft of data pointed to further slowing in China’s economy.

Sectors retreated across the board, with the CSI300 sub-index tracking consumer firms dropping 2.8 percent and the sub-index tracking healthcare firms plunging 3.8 percent.

Both sectors have come under heavy pressure in recent weeks amid a scandal around domestically made vaccines that has undermined broader consumer confidence, as well as heightened worries about the domestic economy and the trade outlook.