Beijing, , 10 Dhulqo’dah 1436/25 August 2016 (MINA ) – Chinese shares plummeted more than eight percent within an hour of trade on Monday in the face of a global sell-off, despite Beijing authorizing its state pension fund to invest in stocks in its latest attempt to shore up markets.
The plunge in China’s equities followed last week’s losses of 11 percent, and hammered stock prices across Asia, as fears grew that a slowdown in China could send the rest of the world into a recession. . IINA reported as quoted by Mi’raj Islamic News Agency (MINA).
The Shanghai Composite Index fell 8.5 percent to close at 3,209.91 points, its biggest one-day loss since an 8.8 percent decline on Feb. 27, 2007.
The index is down 38 percent from its June 12 peak. Meanwhile, Hong Kong’s benchmark Hang Seng Index dropped more than four percent in the first few minutes of trade, the Australian market dived three percent, while Japanese and Taiwanese markets were routed more than two percent.
More than $5 trillion has been wiped off the value of global equities markets since China’s shock devaluation of the yuan on August 11 sparked fears the world’s second-largest economy is weaker than thought. All of the measures taken by the Chinese government, including spending billions on share buy-backs, and Sunday’s announcement that it would invest state pensions in the market to offset the declines, were not working.
Malaise on the markets could continue as investors awaited US GDP figures set for release this week, and a decision on whether the US Federal Reserve would lift interest rates.
Monday’s falls followed heavy falls on Wall Street on Friday, with the Dow Jones Industrial Average posting its worst single-day session in four years and all benchmark indices losing more than three percent. “The market is going to drop further.
It’s normal as the markets across the whole world are falling,” AFP reported quoting Qian Qimin, an analyst from Shenwan Hongyuan. “Financial risk will likely rise quickly, dampening market sentiment,” Ken Chen, KGI Securities analyst, told Bloomberg News. (T/P008/R03)
Mi’raj Islamic News Agency (MINA)