Business / Markets

Stocks dive to month low ahead of G20 Summit in Shanghai

By Dai Tian ( Updated: 2016-02-25 15:56
Stocks dive to month low ahead of G20 Summit in Shanghai

A man checks stock prices at a brokerage in Nanjing, Jiangsu province, Feb 25, 2016. [Asianewsphoto by Su Yang]

Stocks plunged the most in a month on Thursday in run-up to G20 Summit.

The benchmark Shanghai Composite Index slumped 6.4 percent to 2,741.25 as of closing, extending its declines this year to 22.5 percent, while the Shenzhen Component Index tumbled 7.3 percent to 9,551.08.

Nearly 1,400 stocks at the two markets dived by the daily limit of 10 percent, traversing sectors ranging from finance to shipping and electronics.

Volatility is returning to A-share markets, said analysts, after the Shanghai gauge recovered 10 percent from its January low and posted 3.5 percent gains last week.

The plunge comes as China's overnight repurchase rate rose 16 basis points to 2.12 percent, signaling tighter liquidity, and the central bank cut its daily reference rate for a third day in a row to 6.5318 renminbi to the dollar.

Later this week, the world attention will focus on the country, as the 2016 G20 Summit is schedule to be held in Shanghai on Friday and Saturday.

The G20 central bankers and finance ministers will concentrate on topics including global growth, infrastructure investment, the reform of global financial governance, restructuring of sovereign debt, global tax cooperation and the financing of environmental programs, according to Xinhua.

China's Finance Minister Lou Jiwei earlier the week dismissed rumors of a possible discussion on the renminbi exchange rate, saying "there isn't such an item on the agenda".

The CSI 300 Index slid 6.1 percent to 2,918.75 on Thursday.

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