Chinese shares yesterday plunged more than 6 percent to 14-month lows after global crude oil prices dropped again, reviving concerns about global growth and prompting a sell-off in the world’s equity markets.
The benchmark Shanghai Composite Index ended down 6.4 percent after a late selling frenzy at 2,749.79 points, its lowest close since Dec. 1, 2014.
The CSI300 Index of the largest listed companies in Shanghai and Shenzhen dropped 6 percent to 2,940.51, also its lowest since the beginning of December 2014.
Photo: Reuters
After a rebound on Friday last week and early on Monday, crude prices fell back to below US$30 per barrel, not far from last week’s 12-year lows, ending a couple of days of gains for Wall Street stocks.
China’s fickle stock markets have now slumped about 22 percent so far this year on concerns about the slowing economy and confusion over the central bank’s foreign-exchange policy.
Many investors have lost the stomach for the market after a wild ride since summer last year, when shares crashed 40 percent. Beijing intervened to stem that rout and orchestrate a recovery of sorts, but anyone who mistook that for a bottom and bought in would have lost their shirt again this month.
“We’ve seen another stampede driven by panic,” Kaiyuan Securities analyst Yang Hai said.
“There’s no good news in sight while investors are being affected by the global ‘risk-off’ mood,” he said, adding that the slump has triggered a lot of forced liquidation.
Indeed, China’s outstanding margin loans — money investors borrow to buy stocks — declined for 16 consecutive sessions to Friday last week, the longest losing streak on record, with 209 billion yuan (US$31.76 billion) worth of leveraged bets unwound during the period.
“Volume is getting very thin, as there are hardly any fresh inflows, and the process of deleveraging is continuing,” Hengtai Futures analyst Chang Chengwei said.
Investors remain wary about further weakness in the yuan, too, despite assurances from Beijing that it has no intention of pushing it lower to gain a competitive advantage.
Chastened by the market’s bearish reaction to an early this month depreciation of the yuan, the People’s Bank of China has since kept the yuan’s daily midpoint fixing little changed.
Spot yuan was yesterday at 6.5796, just a few pips from Monday’s close, while offshore it weakened to 6.6194, a 0.6 percent discount to the onshore rate.
In a move that could help ease market strains, Japan and China, Asia’s two largest economies, yesterday said they were working to create a new framework to discuss economic policy coordination, such as steps to stabilize the yuan, the Nikkei Shimbun said yesterday.
China’s central bank has jolted global financial markets twice in six months by allowing sharp, sudden slides in the currency, only to step in aggressively to stabilize it.
Chinese state media yesterday weighed in to warn billionaire investor George Soros against betting on falls in the yuan or the Hong Kong dollar.
Soros, dubbed “the man who broke the Bank of England” when he made more than US$1 billion from short-selling the pound in 1992, has said he is betting against the S&P 500, commodity-producing countries and Asian currencies, although he has not specifically mentioned the yuan or Hong Kong dollar.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained