Lawstreet Journal

Stock Markets In China Witness A Nearly 9% Drop Amid Coronavirus Outbreak

Lawstreet Journal 4 Feb 2020 4:32am

Image courtesy: Lawstreet Journal Business Stock Markets In China Witness A Nearly 9% Drop Amid Coronavirus Outbreak

The Chinese equity markets returned on Monday the 3rd of February, 2020 after the extended Lunar New Year holiday break, diving to a 9% low at the open, as the traders played catch up with the mounting Coronavirus concerns in China and across the globe. Businesses in China remain shuttered and travel bans mount, crude oil and shares in Australia and Japan also take a hit after it. 

The Stock markets in China have seen the biggest daily fall for five years as traders rushed to sell amid continued fears about the impact on the global economy of the Coronavirus epidemic. The Shanghai Composite index fell to a 9% gapping to lower to reach 2,716.70, the lowest level since mid-Feb 2019. The index is off the multi-month lows, but still down 7.50% around 2,760 levels, at the time of writing surmounted on a wave of negative sentiment that has been built for 10 days during the long market shutdown for the lunar new year. The index was off 9.1% and very close to the maximum permitted fall of 10% after which trading is suspended. 

In additional efforts to counter the negative economic impact of the coronavirus outbreak and spread, the People's Bank of China (PBOC) slashed the interest rate on 7-day reverse repos (RR) to 2.4% from previously at 2.5% and on 14-day RRs to 2.55% vs. 2.65% previous. The PBOC also injected CNY900bn via 7-day RRs and 300bn via 14-day RRs. On the fx front, The Chinese yuan tumbled to the weakest in five weeks… Continue Reading...

Tagged: Coronavirus  
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