Dow Jones Industrial Average was lower by triple digits throughout most of the trading session Monday after Chinese shares crumbled by 8.5% in the biggest one-day drop since 2007. The drop on the Chinese market comes on the heals of an unprecedented government rescue plan to prop up valuations ran out of steam, throwing Beijing's efforts to stave off a deeper crash into doubt. U.S. stocks fell across the board today, with 2,247 companies falling, leaving only 77 gainers.
Beijing unleashed a barrage of support measures to arrest a slump that started in mid-June however, the relative calm on their market was shattered. Sources say that the China Securities Financial Corporation (CSFC) returned ahead of schedule, some of the loans it took to stabilize the stock market.
At the beginning of July, CSFC became the regulator's weapon of choice, borrowing money from commercial banks to buy shares in Chinese stocks, as they tried to prop up the market. The move by the CSFC did give a lift to indexes which jumped nearly 20% from recent lows, until Monday's renewed decline.
Led by Chinese market index heavyweights including Bank of Communications, China Unicom and PetroChina, more than 1,500 shares listed in Shanghai and Shenzhen sank by their 10% daily limit.
Global investors fears are stoked over market gyrations in China and the broader health of the world's second largest economy.
The CSI300 index, consisting of the largest listed companies in Shanghai and Shenzhen, tumbled 8.6% to 3,818.73 points, while the Shanghai Composite Index shed 8.5% to 3,725.56 points.
Contributed by Millennium Traders
Sections
Categories