Shanghai index cuts losses, other global markets lower
China’s main Shanghai stock index reversed its loss to finish higher on Wednesday while other stock markets were mostly lower as investors were rattled by volatile mainland Chinese stocks and concerns about growth in the world’s second-largest economy.
Europe opened lower with the UK’s FTSE 100 down 1.2 percent at 6,450.39. France’s CAC-40 fell 1.2 percent to 4,910.04, while Germany’s DAX dropped 1.5 percent to 10,753.30. Futures augured a downbeat day for Wall Street. S&P futures and Dow futures both fell 0.4 percent.
The Shanghai Composite Index closed up 1.2 percent at 3,794.11 after plunging as much as 5 percent during the day. Japan’s Nikkei 225 slipped 1.6 percent to 20,222.63 and South Korea’s Kospi fell 0.9 percent to 1,939.38. Hong Kong’s Hang Seng index was down 1.3 percent at 23,167.85. But Australia’s S&P/ASX 200 rose 1.5 percent to 5,380.20.
China’s main Shanghai stock index turned up after trading most of the day lower. The gain came a day after a plunge as investors sold Chinese stocks fearing that the Chinese yuan may fall further. The yuan has been stable for a few days after a series of surprise devaluations by Beijing last week. A cheaper yuan is expected to aid exports for the world’s secondlargest economy but also underlined concerns about the current status of the Chinese economy.
“Given China’s drastic interventions in the market since June, it would be highly unlikely for the government to let the index plummet,” said Angus Nicholson, a market strategist at IG.
Shanghai “would be vastly lower if it wasn’t for ineffectual government intervention that is merely delaying the inevitable,” Michael Every, head of financial markets research at Rabobank Group in Hong Kong, told Bloomberg News.
Investors will look for clues about when the U.S. central bank will begin to raise interest rates for the first time in years when the Federal Reserve releases minutes from its July meeting later Wednesday. The Fed appeared on track to raise interest rates later this year but signaled that it wants to see further economic gains and higher inflation before doing so.
Gold was at US$1,122.65 compared to US$1,119.83 late Tuesday. In other markets: — Malaysia’s main index gained 0.18 percent, or 2.84 points, to close on 1,582.44.
— Bangkok stocks rose 0.47 percent, or 6.51 points, to 1,379.12.
— Jakarta ended down 0.58 percent, or 26.24 points, at 4,484.24.
— Singapore closed 0.28 percent, or 8.40 points, lower at 3,041.25.
— Mumbai ended up 0.36 percent, or 100.10 points, at 27,931.64.
— Wellington rose 0.69 percent, or 39.27 points, to 5,750.03.
— Manila slipped 0.15 percent, or 11.28 points, to 7,344.73.
A man walks past an electronic stock indicator of a securities firm in Tokyo, Wednesday, Aug. 19. China’s main Shanghai stock index reversed its loss to finish higher on Wednesday while other Asian stock markets were mostly lower as investors were rattled by volatile mainland Chinese stocks and concerns about growth in the world’s second-largest economy.