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19-06-2018, 07:31 PM
China Rout Has 1,023 Stocks Plunging 10% in One Day
By Sofia Horta e Costa and Abhishek Vishnoi
June 19, 2018, 6:34 PM GMT+8
In a stock market where investors are used to being disappointed, Tuesday’s plunge still shocked.
China’s benchmark equity gauge sank almost 5 percent at one point and by the close, the escalating tensions with the U.S. had sent 1,023 stocks down by the daily 10 percent limit -- or more than one in four. Greasing the losses was the Shanghai Composite Index’s slide below 3,000, a level previously breached during market crashes in 2015 and 2016.
With Washington and Beijing threatening tit-for-tat moves over import tariffs, investors are worried a trade war will act as a brake on China’s economy and hollow out an already deflating equity market.
Selling intensified last week after data showed weak spots in China’s economy. Rising corporate defaults and the government’s financial deleveraging campaign are also undermining sentiment. But the death of buy-the-dip is all the more dramatic at a time when company profits are rising, a sign that investor pessimism may be snowballing beyond repair.
“Seeing the benchmark dropping below the 3,000 level hurts sentiment even more,” said Hao Hong, chief strategist with Bocom International Holdings Co. in Hong Kong. “Things could get a lot worse if the trade war escalates and China fights back in an unconventional way. I would advise against buying into the selloff.”
More details in https://www.bloomberg.com/news/articles/...in-one-day
By Sofia Horta e Costa and Abhishek Vishnoi
June 19, 2018, 6:34 PM GMT+8
In a stock market where investors are used to being disappointed, Tuesday’s plunge still shocked.
China’s benchmark equity gauge sank almost 5 percent at one point and by the close, the escalating tensions with the U.S. had sent 1,023 stocks down by the daily 10 percent limit -- or more than one in four. Greasing the losses was the Shanghai Composite Index’s slide below 3,000, a level previously breached during market crashes in 2015 and 2016.
With Washington and Beijing threatening tit-for-tat moves over import tariffs, investors are worried a trade war will act as a brake on China’s economy and hollow out an already deflating equity market.
Selling intensified last week after data showed weak spots in China’s economy. Rising corporate defaults and the government’s financial deleveraging campaign are also undermining sentiment. But the death of buy-the-dip is all the more dramatic at a time when company profits are rising, a sign that investor pessimism may be snowballing beyond repair.
“Seeing the benchmark dropping below the 3,000 level hurts sentiment even more,” said Hao Hong, chief strategist with Bocom International Holdings Co. in Hong Kong. “Things could get a lot worse if the trade war escalates and China fights back in an unconventional way. I would advise against buying into the selloff.”
More details in https://www.bloomberg.com/news/articles/...in-one-day
Specuvestor: Asset - Business - Structure.