Chinese stocks follow global markets lower
Chinese stocks tumbled on Monday amid continued uncertainty in global markets.
At the close of market hours, the benchmark Shanghai Composite Index ended lower 0.90 percent at 2,747.21 points, while the smaller Shenzhen Component Index shed 2.03 percent to 9,904.95 points. The blue chip CSI300 Index dropped 0.97 percent to 3,674.11 points.
Turnover on the two major bourses came in at 633.1 billion yuan (US$ 89.11billion), roughly even with the previous trading session.
Chinese mainland markets saw a 1.28-billion-yuan net inflow of overseas capital via the Stock Connect schemes linking Shanghai and Shenzhen with Hong Kong.
Both European and major US share indexes sank on Friday. The US market led the losses, with its three major indexes each losing over 3 percent.
Investors are waiting for the tipping point of the COVID-19 pandemic, which is the major factor swinging markets, say analysts.
However, as China took the lead in containing the virus and resuming work and production, Chinese shares are more lucrative and the highest priority amid global capital reallocation, CITIC Securities said in a note.
China has also ramped up monetary policies to limit the fallout of the COVID-19 epidemic and shore up its economy.
China’s central bank cut its reverse repo rate by 20 basis points on Monday. The reverse repo totaled 50 billion yuan, which would help meet short-term market liquidity demand, said Wen Bin, a chief researcher with China Minsheng Bank.
Despite broad losses, the agriculture, forestry, animal husbandry and fishery sector posted strong performances.
Xinjiang Western Animal Husbandry Co Ltd, Hainan Jingliang Holdings Co Ltd and Zhongnongfa Seed Industry Group Co Ltd hit the daily cap of 10 percent.
The surge was attributed to a looming global food crisis amid the COVID-19 pandemic as some major food producers such as Vietnam recently banned food exports.