China stocks fall in defiance of Beijing’s support efforts

07-Jul (Financial Times) — Hundreds of Chinese companies have halted trading in their shares as Beijing struggles to insulate the economy from the country’s steepest equity decline in more than two decades.

Another 173 firms listed in Shanghai and Shenzhen announced trading suspensions after the market closed on Tuesday, bringing the total to around 940, or more than a third of all listed firms on the two exchanges.

Since hitting a seven-year high less than a month ago, Chinese stocks have suffered a precipitous decline sparked by a clampdown on margin finance — the use of borrowed money to buy shares — in response to worries about an equity bubble.

About $3tn has been wiped off the value of all listed companies as retail investors have rushed to unwind leveraged bets on the market.

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