Shang­hai in­dex cuts losses, other global mar­kets lower

The China Post - - BUSINESS INDEX & -

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.

AP

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.

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