China’s securities regulator suspended a new stock circuit-breaker after a selloff forced local exchanges to shut for the second day this week, signalling that the country’s leadership may reconsider or change the system.
The China Securities Regulatory Commission announced the suspension on its official microblog account on Thursday night. The decision came hours after CSRC officials held an emergency meeting to discuss conditions on the nation’s tumbling stock market, according to a person familiar with the discussions who asked not to be named because he wasn’t authorised to speak publicly.
China’s CSI 300 Index plunged 7.2% on Thursday, triggering an automatic shutdown within 30 minutes of the open, as declines in the yuan rattled investor confidence in the world’s second-largest economy. The nation’s market circuit breakers, which halt exchanges for 15 minutes after a 5% drop in the CSI 300 and for the rest of the day after a 7% retreat, have been criticised by analysts for exacerbating losses as investors scramble to exit positions before getting locked in.
China’s threshold for trading halts looks “quite tight” versus circuit breakers in other markets, Deutsche Bank AG strategists wrote in a report this week. In the US, trading is halted temporarily after declines of 7% and 13% in the Standard & Poor’s 500 Index, and only suspended for the rest of the day if losses reach 20%.
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The China Securities Regulatory Commission announced the suspension on its official microblog account on Thursday night. The decision came hours after CSRC officials held an emergency meeting to discuss conditions on the nation’s tumbling stock market, according to a person familiar with the discussions who asked not to be named because he wasn’t authorised to speak publicly.
China’s CSI 300 Index plunged 7.2% on Thursday, triggering an automatic shutdown within 30 minutes of the open, as declines in the yuan rattled investor confidence in the world’s second-largest economy. The nation’s market circuit breakers, which halt exchanges for 15 minutes after a 5% drop in the CSI 300 and for the rest of the day after a 7% retreat, have been criticised by analysts for exacerbating losses as investors scramble to exit positions before getting locked in.
China’s threshold for trading halts looks “quite tight” versus circuit breakers in other markets, Deutsche Bank AG strategists wrote in a report this week. In the US, trading is halted temporarily after declines of 7% and 13% in the Standard & Poor’s 500 Index, and only suspended for the rest of the day if losses reach 20%.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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