China public security ministry targets illegal market activity

The Shanghai Composite Index closed at 3,507 points on July 8, down 5.9 percent from the previous day.

“Oil is being pressured on multiple fronts, and China’s equity wobble, the prospect of Iran’s re-entry to the market and low liquidity all add up to an extremely fraught environment”.

The China Securities Regulatory Commission (CSRC) had already said the central bank will provide funds to the CSF. Vice Public Security Minister Meng Qingfeng visited the regulator’s offices in Beijing yesterday, Xinhua News Agency said on its microblog.

China’s authorities have also banned anyone who owns a large number of shares from selling their stock for six months.

The 21 brokerages transferred a total of over 128bn yuan into the accounts of state-owned China Securities Finance Corp, which provides margin financing services, the newspaper said, citing Wang Min, vice head of China’s securities association.

Some commentators have likened the conditions to those which saw Wall Street crash in 1929, when billions of dollars were wiped off America’s stock market. The requests were approved, but the companies were told that they face close scrutiny because that stock market allows only firms “working on really significant issues” to cease trading, meaning that they should not be taking the step to stop share prices from falling further, the sources said.

China has halted trade in stock markets due to irrational selling.

The stock market rout has rattled investor confidence and raised concerns that it could pose an even bigger threat to the world economy than the Greek debt crisis.

The crash resulted in sharp falls in the prices of copper and iron ore – the raw component of steel – putting pressure on mining firms in Australia and Brazil. Lately, the value of these shares have fallen considerably.

Government-owned corporations have been ordered not sell their stocks but purchase back as many as they can to help stabilized market.