Asian stocks rose today (August 4th) after China's regulators imposed limits on short selling equities in a bid to stabilise the market. They made the move after the release yesterday of weak manufacturing data, which drove shares down.
Investors who borrow shares must now wait one day to pay back loans, according to statements from the Shanghai and Shenzhen stock exchanges.
The new measures constitute the government's latest efforts to stabilise the market after Chinese stocks suffered three weeks of continued losses in June that wiped out £1.5 trillion.
"They’re basically saying they don’t want the market to sell off a lot more from here," Mohammed Apabhai, head of Asia trading strategy at Citigroup Inc. in Hong Kong, told Bloomberg TV. "This is yet another measure that they will use to defend the market and there’s probably more to come."
Japan's benchmark Nikkei 225 edged down 0.1 per cent to 20520.36, Australia's S&P/ASX 200 gained 0.3 per cent to 5697.90 and Hong Kong's Hang Seng remained flat at 24,407.33. The Shanghai Composite jumped 3.7 per cent to 3756.54 while South Korea's Kospi added one per cent to 2027.99.
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