China’s stocks drops over 5% after regulatory crackdown on margin trading FXStreet (Mumbai) - The Chinese benchmark index, the Shanghai Composite (SCI) plunged over 5% in the Asian morning with continued bashing in bank and financial stocks, after the regulator imposed penalties on top brokerages on their margin trading business. Currently, the SCI trades at 3204.62 levels, down -5.09% on the day, close to the day’s low at 3179.21 levels. Shanghai stocks suffered their sharpest fall in five years after the regulator punished Citic Securities and Everbright Securities for their illegal operations in their margin tradin business. The brokerage stocks plunged by the maximum daily trading limit of 10% after regulators announced measures to crack down on margin trading late on Friday. Moreover, tightening of regulatory controls over shadow banking also hit banking stocks hard. The regulatory moves came a day before release of Chinas fourth quarter gross domestic product (GDP) tomorrow. The report is expected to show the economy grew 7.2 percent on year, down from 7.3 percent in the third quarter. SCI Technical Levels The index has an immediate resistance stands at 3369.28 (Jan 5 High) above which gains could be extended to 3400 (Jan 16 High) levels. Meanwhile, support is seen at 3157.26 (Dec 31 Low) and from here to 3126.94 (Dec 29 Low) levels. 03:27 GMT - FXStreet
Posted on: Mon, 19 Jan 2015 03:45:38 +0000
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