Thursday, March 4, 2021
Home World Black Friday: Chinese stock market plummets by 1.5 trillion pounds in three...

Black Friday: Chinese stock market plummets by 1.5 trillion pounds in three weeks

shanghai-Composite

By NewsGram Staff Writer

Even as the debt crisis continues to devour Greece, a financial catastrophe is wreaking havoc in the other part of the world.

In the preceding three weeks, the Chinese stock market has lost value equivalent to a jaw dropping £1.5 trillion —an amount that is almost 10 times the size of Greece’s annual GDP.

The epic fall marks the worst three weeks for Chinese stock markets since 1992.

Following a record breaking eight month period during which it reached its peak on June 12,  the Shanghai Composite, an index of all stocks traded on the Chinese stock exchange, has fallen 30 per cent.

The third straight ‘Black Friday’ has seen the market crash by 3.25 per cent, falling below 4,000 for the first time since April.

Keeping in the mind the precipitous fall, China’s financial regulator has said it will investigate for suspected market manipulation.

The abnormal market movements from stock market and futures exchanges–including allegations that some overseas investors are driving prices down by short-selling Chinese stocks–will be investigated by the China Securities Regulatory Commission market (CSRC).

The China Financial Futures Exchange (CFFEX) has already suspended 19 accounts from short-selling for a month, a Reuters report noted.

Another probable reason for the sudden downfall could be the massive overvaluation of the Chinese markets, having inflated by 150 per cent in just one year.

“Shanghai’s benchmark index is expected to fall by a further 2-30 per cent over the next year”, said a Morgan Stanley senior analyst while claiming this to be the end of a cycle of growth.

Global Times, Chinese newspaper denied blaming foreign investors for the rapid fall.

“Foreign capital has only a small part of the Chinese stock market. Large-scale short selling by foreign investors in the Chinese stock market has not appeared and is an unlikely scenario”, the newspaper said.

Meanwhile, in response to the drop in the Shanghai Composite, the government has cut the cost of borrowing and eased margin lending rules, encouraging brokerages to lend money.

STAY CONNECTED

19,120FansLike
362FollowersFollow
1,773FollowersFollow

Most Popular

Best Sites To Play Andar Bahar Online

By John Graham Playing Andar Bahar is fun, especially when playing on a user-friendly site. It’s a game where you play and win. Besides, it’s...

7 Tips On How To Always Wake Up On Time In College

By Grace Johnson Many students complain that waking up early to go to classes seems to be getting more and more difficult day by day....

US Based OAC To Make The World’s First Space Hotel

If you are a space enthusiast, there is more exciting news as a US-based space construction company, Orbital Assembly Corporation (OAC), is planning to...

Gut Instinct To Figure Out Between Fake And Genuine Reviews

While booking a hotel online, travelers should trust their gut instinct rather than relying on computer algorithms to figure out between fake and genuine...

Study: Customized Diets Could Be Key To Optimizing Mental Health

Lifestyle changes and customized diets could be key to optimizing mental health, a new study suggests. The study indicates that significant customized diets and...

Study: One In Four People, Maybe Living With Some Degree Of Hearing Loss By 2050

Nearly 2.5 billion people worldwide, or one in four people, maybe living with some degree of hearing loss by 2050, and at least 700...

Rare India: Commit To A Life That Puts Planet And People First

The Climate crisis is real, and the travel industry is affected in so many ways that there is an immediate need to address how...

World Wildlife Day: Here Are Some Wildlife Sanctuaries Worth Visiting

With millions of species breathing on earth, the world celebrates Wildlife Day today, March 3, to raise awareness of global flora and fauna. There...

Recent Comments