Chinese stock exchanges closed early for the second time this week after the CSI 300 Index plunged more than 7 per cent.
Trading of shares and index futures was halted by automatic circuit breakers from about 9:59 a.m. local time. Stocks fell after China’s central bank weakened the currency’s daily reference rate by the most since August.
“The yuan’s depreciation has exceeded investors’ expectations,” said Wang Zheng, Shanghai-based chief investment officer at Jingxi Investment Management Co. “Investors are getting spooked by the declines, which will spur capital outflows.”
Under the mechanism which became effective Monday, a move of 5 per cent in the CSI 300 triggers a 15-minute halt for stocks, options and index futures, while a move of 7 per cent close the market for the rest of the day. The CSI 300 of companies listed in Shanghai and Shenzhen fell as much as 7.2 per cent before trading was suspended.
Chinese stocks in Hong Kong, which doesn’t have circuit breakers, slumped 4.4 per cent. The offshore yuan fell to a five– year low before erasing losses.Report Typo/Error