(Newswire.net — August 24, 2015) — Major turbulence in the Asian stock market has affected other markets globally. After a historical rise, the China stock market closed surprisingly low on Monday. The Shanghai composite has closed 8.5 percent in the red, as Beijing’s measures have failed to ease investor’s concerns about the slowdown of Chinese economic growth, Russia Today reported.
China’s stocks are now down for the year after being up 60 percent in June, RT reported as ‘Breaking News.’
As the world’s second-largest economy suffered a serious blow, Asian markets followed China’s selling trends.
Japan’s Nikkei has closed 4.6 percent down. Hong Kong’s Hang Seng is 5.21 percent in the deficit. Mumbai’s Sensex is down over 4 percent in late trading.
The European stock markets also felt the ‘Asian financial quake’ after opening Monday. In early trading, London’s FTSE is down 2.5 percent and Germany’s DAX is losing over three percent so far, sliding below the 10,000-point mark for the first time since January.
Last week’s negative trend in the European markets stretched over the weekend, after the majority of Western EU markets lost at least a percent. Out of 18 western European markets, 13 lost 10 percent or more, with Germany’s DAX Index down 18 percent. London’s FTSE 100 index suffered its biggest weekly drop in 2015, slumping 5.2 percent.
The Russian ruble has hit new lows against major currencies, RT reported. Experts linked the new dive of Russian currency to both weak oil and Chinese stocks, since Moscow and Beijing agreed to exchange their national currencies in oil trading, ‘pulling the rug’ beneath the petrodollar.
As of 07:44 GMT, the US dollar is trading for 71 Russian Rubles and the Euro for 81.40 rubles.
While global instability of the financial market isn’t exactly news by itself, the extreme dive of the Chinese Yuan comes unexpected, as the Chinese government has taken drastic measures over last month to amortize the stock market’s decline. According to the Guardian, the FTSE dive could spark a global market crisis.
The Xinhua news agency reported Sunday, that Beijing would allow for the first time the intervention from its main state pension fund with investing of up to 30 percent of its net assets in China-listed shares of stock.