Chinese stocks have plunged for a second day after worries over China’s slowing growth triggered a global sell-off.<\/p>\n
[contextly_sidebar id=”XTqTPMEWeb8HXzfSzpgmiigQWYaVK5ty”]The Shanghai Composite, China’s main stock exchange, fell 7.6% on Tuesday – after losing 8.5% on what state media have called China’s “Black Monday”.<\/p>\n
It was the worst fall since 2007 and caused sharp drops in markets in the US and Europe<\/p>\n
Tokyo’s Nikkei index had a volatile day, closing 4% lower.<\/p>\n
The Shanghai index ended the day 245 points lower at 2,964.97.<\/p>\n
After decades of rapid growth, China is slowing down, and investors globally are worried 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.<\/p>\n
Some investors had hoped that the Chinese government might make a dramatic intervention to help.<\/p>\n
But after two months of attempting and failing to shore up the markets at a cost of hundreds of billions of dollars in state funds, even Beijing now seems to be thinking hard about what stock prices are sustainable in the long term.<\/p>\n
For a government whose legitimacy rests on economic competence, and which had hoped that a rising stock market would help ease the problems of a wider economic slowdown, this financial crisis still carries real political dangers.<\/p>\n
Chinese shares had experienced a year-long rally – mainly fuelled by investors borrowing money to buy shares – which came to an end in June.<\/p>\n
The Chinese government then intervened in financial markets, to try to maintain momentum in the economy.<\/p>\n
Two weeks ago the central bank devalued the currency, the yuan – this raised fresh concerns that China’s economy could be in worse shape than previously thought.<\/p>\n
A cheaper currency lowers the price of China’s exports, making them more attractive to global firms.<\/p>\n
Elsewhere in Asia and Australia on Tuesday, markets beat expectations, opening lower but then returning back to positive territory:<\/p>\n
The dollar remained weak at 119.15 yen, up from a seven month low of 118.51 yen in New York on Monday.<\/p>\n
Commodity prices also recovered after Monday’s falls, although oil remains under pressure because of a global oversupply.<\/p>\n
Overnight, the Europe and the US saw dramatic falls, but are expected to show some signs of recovery when they open on Tuesday.<\/p>\n
–<\/p>\n
Source:\u00a0 BBC<\/p>\n","protected":false},"excerpt":{"rendered":"
Chinese stocks have plunged for a second day after worries over China’s slowing growth triggered a global sell-off. [contextly_sidebar id=”XTqTPMEWeb8HXzfSzpgmiigQWYaVK5ty”]The Shanghai Composite, China’s main stock exchange, fell 7.6% on Tuesday – after losing 8.5% on what state media have called China’s “Black Monday”. It was the worst fall since 2007 and caused sharp drops in […]<\/p>\n","protected":false},"author":14,"featured_media":134675,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[19],"tags":[4],"yoast_head":"\n