Foreign selling hammers Chinese stocks in near US$1 trillion wipeout
Foreign investors have sold a record $10.7 billion of Chinese stocks in 13 consecutive trading sessions, causing a significant dip in the market.
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Posted 8/24/2023, 9:00:09 AM
scmp.com
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Asian stocks, particularly Chinese markets, may find some relief after Wall Street's resilience in the face of rising bond yields, though economic data from China remains underwhelming and foreign investors continue to sell Chinese stocks.
Hong Kong's stock market has benefited from China's rapid growth, with over 1,400 Chinese companies raising $1.05 trillion in the past 30 years.
Asian stocks sold off and the dollar reached an 11-week high against major peers as investors prepared for a potentially hawkish stance from Federal Reserve Chair Jerome Powell at the Jackson Hole meeting, with concerns about global growth and a firmer dollar weighing on crude oil.
Chinese stocks, including Alibaba and JD.com, experienced a rally after the government announced plans to reduce trading taxes and implement measures to boost capital markets.
China's stock market indexes experienced a brief bounce of over 5% before giving up most of the gains, following new government measures to reduce trading costs and boost stocks, raising questions about the severity of China's economic problems and whether they can be resolved through stimulus measures.
Chinese stocks rebounded briefly after Beijing implemented measures to halt the slide, but foreign investors used the opportunity to unload $1.1 billion of mainland Chinese equities, reflecting ongoing nervousness about holding capital in China.
China stocks rise as investors welcome Beijing's efforts to support the market, while bonds rally and the dollar dips on possibly softening U.S. data.
India's stock market has seen a rally as strong macroeconomic fundamentals and China's economic slowdown keep foreign investors invested in Indian stocks, while a surge in retail investor interest continues to drive the market.
Chinese stocks experienced the largest monthly outflow in a year, with foreign investors withdrawing $15.5 billion from emerging market portfolios in August, driven by concerns over China's economic growth.
Investors have pulled £10 billion from Chinese stocks as China's economy continues to decline, with declining exports and struggling real estate contributing to the turmoil.
Asian shares sink on worries about the Chinese property sector and Japanese investors sell chip stocks, while benchmark U.S. Treasury yields and the dollar remain high ahead of key central bank decisions.
Despite Beijing's efforts to revive Chinese markets, key indicators show that traders are continuing to sell off their equity positions, resulting in the lowest levels of Chinese stocks in about 10 months and a significant withdrawal of global funds from the market.