Asia shares stagger, yearn for China support

Mon Jan 4, 2016 6:43pm EST
 
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By Wayne Cole

SYDNEY (Reuters) - Asian share markets were on the ropes for a second straight session early Tuesday as investors anxiously waited to see if Beijing can head off the latest selling stampede in Chinese stocks.

An unnerving combination of global economic concerns and escalating tensions in the Middle East also crunched commodity prices while bolstering safe-haven sovereign bonds.

Nikkei futures JNc1 were down another 0.9 percent, after the cash index .N225 fell 3.1 percent on Monday in its biggest single-day slide since Sept. 29.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS eased 0.2 percent, while Australian stocks .AXJO lost 1.1 percent.

All eyes were on China after stocks tanked on the first trading day of the year, triggering a "circuit-breaker" that suspended equities trade nationwide for the first time.

The CSI300 index .CSI300 of the largest listed companies in Shanghai and Shenzhen sank 7.0 percent before trading was suspended, its worst single-day performance since August last year when in the throes of another market rout.

Indeed, that August episode likely planted the seeds of the latest slide since authorities reacted back then by imposing a lock-up on share sales by major institutional investors.

That lock-up is slated to end in the next few days, allowing the sale of perhaps 1.24 trillion worth of shares according to some estimates. Some are now wagering Beijing will extend the lock-up period given the severity of Monday's dive.   Continued...

 
People walk past an electronic board showing the benchmark Shanghai and Shenzhen stock indices, on a pedestrian overpass at the Pudong financial district in Shanghai, China, January 4, 2016.  REUTERS/China Daily