The Asian markets closed mostly in green on Wednesday, while China’s stock market has fallen again, for the fifth day running, as the market rout continues despite its central bank’s efforts to calm the crisis by cutting interest rates on Tuesday. The People’s Bank of China cut its benchmark interest rate and lowered the amount of cash banks are required to hold, as Beijing steps up efforts to support a stock market rout and a deepening economic slowdown. The People’s Bank of China cut the one-year lending rate to 4.6% from 4.85% effective Wednesday. China’s central bank also reduced its reserve requirement ratio by 0.5%, with that requirement effective on September 6. China’s central bank injected 140 billion yuan ($21.8 billion) into the interbank money market via short-term liquidity operations (SLOs). The loans, which mature in six days, have an average interest rate of 2.3%. The PBOC launched SLOs in 2013 to supplement its other monetary policy tools. The facility is mainly used to provide one- to three-day direct lines of credit to commercial banks, though loans with other maturities are occasionally used. The Bank of Korea board member stated that the biggest risk facing South Korea’s economy in the second half of the year is the US Federal Reserve’s pending interest rate hike. The government and the central bank is also preparing responses for future risks, including volatility from economic troubles in China and uncertainties coming out of other emerging market economies. Japan’s corporate services price index rose to a seasonally adjusted annual rate of 0.6%, from 0.4% in the preceding month. Singaporean Industrial Production fell to an annual rate of -6.1%, from -4.0% in the preceding month whose figure was revised up from -4.4%.
Asian Indices | Last Trade | Change in Points | Change in % |
Shanghai Composite | 2,927.29 | -37.68 | -1.27 |
Hang Seng | 21,080.39 | -324.57 | -1.52 |
Jakarta Composite | 4,237.73 | 9.23 | 0.22 |
KLSE Composite | 1,580.37 | 16.43 | 1.05 |
Nikkei 225 | 18,376.83 | 570.13 | 3.20 |
Straits Times | 2,873.00 | -13.29 | -0.46 |
KOSPI Composite | 1,894.09 | 47.46 | 2.57 |
Taiwan Weighted | 7,715.59 | 39.95 | 0.52 |
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