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Big stocks fall fuels China growth fears

Monday, July 27, 2015 - 01:38

Concerns over China dominate financial markets, the biggest fall in Shanghai shares in eight years dragging European stock markets and the prices of major commodities like copper and oil sharply lower. Ciara Lee reports

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A bad start to the week in Asia - Chinese shares fell more than eight percent on Monday. Major indexes suffered their largest one-day drop in eight years with renewed fears over the world's second largest economy. It shatters a period of relative calm in China's stock markets since Beijing unleashed scores of measures to reverse a slump that began in mid-June. The fall came after weaker data on profit at Chinese industrial firms. That followed figures from last week showing factory activity at its slowest pace in over a year. Robert Halver is a market analyst at Germany's Baader Bank. (SOUNDBITE) (German) CAPITAL MARKETS ANALYST AT BAADER BANK, ROBERT HALVER, SAYING: "China is hugely important for the world economy. If things continue like this the central bank in China will buy its own shares of the companies in the country. China can not get weak because otherwise, the entire world economy will have a problem and Greece will look like a children's birthday party in comparison." The fallout from was also felt in Europe, particularly the share price of German exporters. Darren Sinden is from Admiral Markets UK. (SOUNDBITE) (English) DARREN SINDEN, MARKET RESEARCH AND CLIENT RELATIONS MANAGER, ADMIRAL MARKETS UK LIMITED, SAYING: "Things like BASF down five percent. Many of the German auto makers down 3 to 3 and a half percent today. And these of course are all very Chinese-centric companies. The sentiment at least around them is the automakers of course have had a marvellous time selling their luxury cars in China over the last five or six years but sales are starting to dwindle." While some analysts say there was little to explain the scale of the sell-off, others fear that China might hold off from further loosening of monetary policy. That could be souring investor sentiment. As could the prospect of a rate rise in a sluggish U.S. market. /////

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Big stocks fall fuels China growth fears

Monday, July 27, 2015 - 01:38