The Asian equity benchmarks ended mostly lower on Tuesday, with Shanghai Composite Index slumping the most in more than five years amid extreme volatile trading that sent the mainland stock bourses’ turnover to a record. China’s policy change was the biggest drag on the market as there’s a liquidity crunch. China’s authorities announced that lower-rated bonds can no longer be used as collateral for some short-term loans, sparked sell-off in debt and the yuan. The move will help remove riskier debt from the repo market before China requires local government financing vehicles to clarify next month which bonds are backed by the state. Japan’s M2 Money Stock rose to a seasonally adjusted 3.6%, from 3.2% in the preceding month.
Indonesia’s central bank, which quickly raised the benchmark rate after the government hiked fuel prices last month, is expected to keep all rates unchanged at its last policy meeting for the year scheduled on Thursday. At a special meeting right after President Joko Widodo announced gasoline and diesel prices hikes, the central bank also raised the lending rate by 50 basis points to anchor inflation expectation and encourage interbank borrowing. The World Bank has cut its growth forecast on Indonesia’s economy for next year to 5.2% from 5.6% as projected in July, due to a weaker outlook of the country’s exports and investment growth. The projection by the Washington-based lender is lower than government estimates for next year’s growth, which is at 5.8%.
Asian Indices | Last Trade | Change in Points | Change in % |
Shanghai Composite | 2,856.27 | -163.99 | -5.43 |
Hang Seng | 23,485.83 | -561.84 | -2.34 |
Jakarta Composite | 5,122.31 | -21.70 | -0.42 |
KLSE Composite | 1,738.10 | -2.74 | -0.16 |
Nikkei 225 | 17,813.38 | -122.26 | -0.68 |
Straits Times | 3,319.84 | 22.00 | 0.67 |
KOSPI Composite | 1,970.95 | -8.00 | -0.40 |
Taiwan Weighted | 9,128.90 | -58.39 | -0.64 |
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