Chinese stock exchanges still making huge losses
Hong Kong (AsiaNews) - Asia stock exchanges have opened to a shaky start this week following continuing losses triggered in recent days by the Shanghai and Shenzhen Stock Exchanges. In a statement today, the Haitong Research Institute described China as "everybody’s worst nightmare” in 2016.
In the morning session the Shanghai index was down by 3.2%; Shenzhen 4.4%, Hong Kong 2.4. Last week, the Shanghai index had lost 10%; Hong Kong 6%, returning to values of 2013.
In other markets, Tokyo was closed for a national holiday, while Seoul marked up a loss of 1.2%; in Australia, the index closed at least 1.2%; in India there is a decline of 0.4%.
Last week, the first of this year, Chinese trading was suspended twice last week on dramatic plunges in values that triggered a circuit breaker mechanism, which stops the transaction if the losses are more than 5%. In the end, China decided not to use this mechanism and on 8 January and instead tried to intervene to support company shares, with a "national team" that bought shares on the market, raising the index. Analysts say these interventions distort the market and do not help the country face its problems. For some time the Chinese leadership has been forced to rethink its development model based on cheap labor, export, heavy support to state-owned enterprises which have become uneconomic mammoths.
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