China Stock Indexes Fell Again Thursday Despite New Margin Policies
Chinese shares closed lower again Thursday, with the benchmark Shanghai Composite Index down 3.48% to finish at 3912.77 pts.
The Shenzhen Component Index dipped 5.32% to close at 12924.19 pts.
Losers outnumbered winners by 878 to 54 in Shanghai, and by 1289 to 80 in Shenzhen. More than 1,400 shares on the 2 exchanges dove the daily limit of 10%.
Shares related to ship building, reforms in the Oil and Gas industry, real estate and electricity were biggest losers.
Bucking the trend, stocks of securities and banks were among the leading winners.
The ChiNext Index, tracking China’s Nasdaq-style board of growth enterprises, lost 3.99% to end at 2649.32 pts.
The benchmark Shanghai index shed 24.29% over the course of more than 2 weeks. It dove 7.4% on June 26, the sharpest daily drop since 10 June 2008.
The slump continued despite a raft of government easing measures. The PBOC cut interest rates and the RRR (reserve requirement ratio) over the weekend. An official draft guideline Monday gave pension funds the nod to invest in the stock market.
Wednesday night, several favorable policies were rolled out in response to the plunging stock market, which has been on a more than 2-week losing streak pushing the indexes into Bear territory.
The 2 exchanges, and China Securities Depository and Clearing Company announced that transaction fees and transfer fees on stock transactions would be reduced on the Shanghai and Shenzhen stock exchanges.
China Securities Regulatory Commission (CSRC), the securities watchdog, announced that stock brokerages were allowed to issue bonds to widen funding channels.
The previously strict rules on margin stock trading by brokerages were also relaxed by the CSRC.
By Xiang Bo
Paul Ebeling, Editor
HeffX-LTN
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