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Volatility sends China into bear market

Friday, January 15, 2016 - 01:31

Chinese shares tumble again, with the Shanghai index closing lower than at any time since December 2014. Joel Flynn reports.

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A turbulent end to a turbulent week on the markets - no respite from the headwinds seen in 2016 in sight yet. World stocks set for a third straight week of losses. European stocks falling more than 1 percent in early trade, tracing Asia's share losses as they skidded to three and a half year lows. And at the centre of all the volatility is China. Brenda Kelly is from London Capital Group. SOUNDBITE: London Capital Group Head Analyst, Brenda Kelly, saying (English): "It's the actual sentiment coming from China which has now entered a bear market, down 20 percent from it's actual highs of last year, that is actually affecting investor confidence, and until we see that investor confidence return we can expect to see choppy markets with a bias to the downside." Commodity-linked currencies once again in markets' sights as oil prices fell back below 30 dollars a barrel. Fresh selling pressure hitting Brent and U.S. crude - only shortly after posting their first significant gains for the year. Oil's collapse has further spooked markets amid growing worries about the global economy. SOUNDBITE: London Capital Group Head Analyst, Brenda Kelly, saying (English): "Well China is the second biggest consumer of commodities and until it starts to pick up we are going to see this problem faced. You also have the stronger U.S. dollar which is also having an impact on commodity prices as well, so that is exporting disinflation to other Western economies." The Shanghai Composite index closed at a 13 month low. China's yuan meanwhile has lost 1.4 percent of its value against the dollar. A host of data is expected on Monday - few investors expect any less turbulence next week.

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Volatility sends China into bear market

Friday, January 15, 2016 - 01:31