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BEIJING (AP) – Chinese stocks tumbled again Tuesday after their biggest decline in eight years while most other Asian markets rebounded from a day of heavy losses.
By 0200 GMT, the CSI300 index was down 4.4% at 3,132.26 points, while the ShanghaiComposite Index Shanghai composite lost 4.8% to 3,057.04 points. Japan’s Nikkei reversed early losses, rising 0.5 percent to 18,620.89. The Hong Kong Hang Seng Index shed 0.6 percent after losing more than 5 percent on Monday. Stocks fell in early trading Monday in Asia as investors shaken by the sell-off last week on Wall Street unloaded shares in many se…
Here at Business Insider we decided to have a look at the history books to see how often a two-day fall of more than 10% has occurred, and what has subsequently happened the day after fall of such magnitude has been recorded.
“It’s a panic sell-off and the market has overreacted”, Chen Jiahe, chief strategist for Cinda Securities, told AFP.
The trading roller-coaster roiled the world’s most valuable company, Apple, which began the morning down 13 percent before bouncing back into positive territory – and then sagging back almost 2 percent into the red.
The dismal opening marked a steep continuation of last week’s freefall. China’s benchmark indexes have now lost roughly 20 percent in August and are heading for their worst monthly performance in six years, barring a sharp rebound in the last few days of the month.
Trading on the the S&P 500 and Nasdaq 100 futures boards was also repeatedly halted early Monday after the contracts hit their 5-percent overnight limit.
Wall Street stayed in a narrow range for much of 2015, but volatility has jumped as investors became increasingly concerned about a potential stumble in China’s economy.
The blue-chip CSI300 index fell 3.9 percent, to 3,147.76 points, also paring some of its losses when trading opened.
Asian stock markets showed signs of recovery Tuesday morning after most markets opened lower.
In recent months, the Chinese government has intervened in financial markets, in an attempt to try to maintain momentum in the economy.
Gold futures on the COMEX division of the New York Mercantile Exchange fell on Monday following a slump in other metals, despite a weakening US dollar. Yields for the 10-year bonds dropped below 2 percent for the first time since April.
Moreover, speculation had been building all year for the Federal Reserve to raise interest rates in September for the first time since 2006, following the end of quantitative easing in 2014.
Investors’ biggest worry is that firms and countries which rely on high demand from China – the world’s second largest economy and the second largest importer of both goods and commercial services – will be affected.