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China Market falls to four-year low

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The Mainland equity market retreated to four-year low on Thursday, 11 October 2018, as risk aversion selloff triggered on tracking overnight dive in European and US markets overnight amid growing concerns about rising US interest rates, ongoing trade friction between the U. S. and China, and worries over global growth. Most of sectors declined, with shares from oilfield services, communication devices, domestic software and 5G companies have seen the biggest drops across the markets. At closing bell, the benchmark Shanghai Composite Index tanked 5.22%, or 142.22 points, to 2,583.46, meanwhile the Index, which tracks stocks on China's second exchange, fell 6.45%, or 89.14 points, to 1,293.90. The blue-chip CSI300 index shed 4.8%, or 157.49 points, to 3,124.11.

Wall Street tumbled on Wednesday, with the and the Dow marking their biggest daily declines since Feb. 8 as markets were spooked by the prospect of rising interest rates. The fall was driven by a rise in U. S. long-dated Treasury yields, which reinforced expectations of several interest rate hikes over the next 12 months and prompted investors to reassess equity valuations. Over the past few months, an intensifying trade war between the and has also hit risk assets on worries about global growth.

A move by over the weekend to inject more liquidity into the system has failed to comfort investors worried about the potential for US Donald Trump's anti-rhetoric to widen beyond a trade spat into a cold war. Weak Chinese and a stronger US dollar were also offsetting Beijing's efforts to stabilise the by loosening lending requirements, cutting taxes and selling more domestic bonds, traders warned.

China's central on Sunday continued its loosening stance, cutting the amount of reserves the country's domestic banks must hold by 100 basis points, its fourth reduction in just over a year. Analysts said the move would inject about 750 billion yuan into the local

Telecom and stumbled, with and 360 tumbling more than 9%.

Shares of luxury goods companies fell amid crackdown at Chinese borders on undeclared goods, with tumbling the most in 13 months. dropped as much as 28% on its trading debut.

CURRENCY NEWS: China's yuan weakened slightly against the U. S. dollar on Thursday amid soft mid-point fixing by central and as a global equity sell-off that shrank risk appetites. Prior to market open, the of China set the midpoint rate at 6.9098 per dollar, weaker than the previous fix of 6.9072. The spot market opened at 6.9307 per dollar and was changing hands at 6.9306, weaker by 66 pips from the previous late session close and 0.3% away from the midpoint.

OFFSHORE MARKET NEWS, US closed mixed on Tuesday, as investors worried about global growth prospects. The dipped 56.21 points or 0.2% to 26,430.57 and the edged down 4.09 points or 0.1% to 2,880.34. The tech-heavy Nasdaq inched up 2.07 points to 7,738.02

The major European markets ended higher on Tuesday. The German DAX Index and the French Index rose by 0.3% and 0.4%, respectively. The U. K.'s Index inched up by 0.1%.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, October 11 2018. 13:59 IST