Nerves on edge as Chinese authorities probe market mayhem
By Paul Carsten and Nishant Kumar
BEIJING/LONDON (Reuters) - The head of hedge fund manager Man Group Plc's (EMG.L: Quote) China business has been taken into custody to help authorities in a probe into recent market volatility, Bloomberg reported on Monday, while separately a local financial reporter confessed on national TV to having spread false information that caused "panic and disorder".
Both are likely to jangle nerves in the financial industry as regulators try to find out who they think was behind China's wild stock market rollercoaster ride in the past three months.
Authorities have been investigating possible market manipulation following wild swings in the stock markets, .CSI300 .SSEC which have plunged around 40 percent since mid-June on concerns of a slowing economy and a surprise devaluation of the yuan currency CNY=CFXS earlier this month.
Officials are probing the financial industry amid allegations of malicious short-selling and other strategies seen as weakening confidence in the market.
Bloomberg, citing a person familiar with the matter, said Li Yifei, Man Group's China chairwoman, was assisting with police inquiries, noting this doesn't mean she faces charges or has done anything wrong. Reuters could not independently confirm the report.
Man Group spokeswoman Rosanna Konarzewski declined to comment on the matter, and China's Ministry of Public Security could not immediately be reached for comment outside regular working hours.
Li's husband, Wang Chaoyong, told Reuters he had spoken to his wife on Sunday and Monday, and she had told him she was in "highly confidential" meetings. "She said she was in meetings and it's inconvenient for me to contact her," he said by phone, adding he did not know where the meetings were taking place.
Separately, Chinese police are looking into the spreading of rumors about the stock market, as well as other issues such as the fatal explosions at a chemical storage facility in Tianjin. Continued...