Asia stocks mixed as China surges on new shorting rules
Asian stocks were mixed in afternoon trading, as China announced new rules restricting short selling after a recent market rout and Australia held interest rates at rockbottom levels.
Shanghai jumped 3.69 percent or 133.63 points to 3,756.54, while Hong Kong ended flat, down 0.02 percent or 5.3 points to 24,406.12.
Tokyo eased 0.14 percent or 27.75 points to close at 20,520.36, while Seoul gained 0.97 percent or 19.50 points to close at 2,027.99.
In Australia, the benchmark S&P/ASX200 index advanced 0.33 percent or 18.6 points to close at 5,697.9.
Shanghai enjoyed a late spurt after China’s two stock exchanges announced new rules that effectively restrict short selling, declaring Monday that investors who borrow shares must wait until the next day to pay back the loans, instead of settling the same day as under previous rules.
Since the Shanghai market crashed 30 percent from its peak in mid-June, China has announced a series of stabilizing measures, including a ban on major shareholders selling stocks and suspension of new share offerings.
The Shanghai exchange statement said the move aimed to improve risk management and protect market order.
“All the government’s measures including restrictions on short selling are working now,” Wu Kan, a Shanghai-based fund manager at JK Life Insurance Co., told Bloomberg News. “It’s a rebound and given the momentum, it may last for some days.”
Investor nervousness has been compounded by weak Chinese manufacturing activity last month, with similarly negative data announced in the United States on Monday.
In Tokyo share trade, Toyota fell 0.96 percent to end at 8,121 yen. The company said after the closing bell its net profit for the three months to June jumped 10 percent to US$5.2 billion.
Markets Await U.S. Economic
Elsewhere, India’s central bank kept its own key interest rate on hold Tuesday, as analysts had expected, resisting government pressure for a fourth cut of the year.
The Reserve Bank of India (RBI) has cut rates three times in 2015 to aid India’s economy, which outper- formed China’s for the first three months this year.
The RBI said the benchmark repo rate — the level at which it lends to commercial banks — would remain at 7.25 percent.
Government pressure to announce another cut was eased by data released Monday that showed factory output climbed to a sixmonth high in July on strong demand.
Standard & Poor’s said it had changed the outlook for the European Union from stable to negative after the bloc’s support for Greece and following Britain’s decision to vote on leaving the EU.
Gold fetched US$1,092.65 an ounce compared with US$1,092.73 on Monday. In other markets:
— Mumbai fell 0.41 percent, or 115.13 points, to end at 28,071.93 points.
Hero Motor Corporation fell 2.73 percent to 2,624.25 rupees, while Tata Steel gained 3.39 percent to 256.40 rupees.
— Bangkok slid 0.69 percent, or 9.88 points, to 1,432.16.
Electricity Generating dropped 0.65 percent to 153.50 baht, while oil company PTT fell 2.75 percent to 318.00 baht.
— Kuala Lumpur lost 1.17 percent, or 20.46 points, to 1,723.73.
Maybank fell 0.11 percent to 9.17 ringgit and British American Tobacco dropped 0.89 percent to 66.70 ringgit, while Public Bank rose 0.52 percent to 19.16 ringgit.
— Singapore closed down 0.05 percent, or 1.75 points, to 3,191.04.
Real estate developer Capitaland eased 1.85 percent to SG$3.18 while Singapore Airlines slipped 1.34 percent to SG$10.31.
— Jakarta ended down 0.40 percent, or 19.10 points, at 4,781.09.
Coal miner Bukit Asam gained 5.04 percent to 6,250 rupiah, while telecommunication infrastructure company Tower Bersama Infrastructure fell 3.31 percent to 8,025 rupiah.
— In Wellington, the NZX-50 was down 0.40 percent or 24.09 points at 5,933.76.
Spark was 1.67 percent off at NZ$2.945 while Meridian Energy was down 1.29 percent at NZ$2.29.
— The Philippine stock exchange closed 0.33 percent higher, gaining 25.03 points to close at 7,598.29.
Top-traded Globe Telecom Inc. gained 1.37 percent to 2,670 pesos while Metropolitan Bank and Trust Co. rose 0.51 percent to 88.50 pesos.