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China: Stocks post biggest slump in 4 months on margin tightening
[SHANGHAI] China stocks slumped on Thursday, posting their biggest fall in four months, after several major brokerages tightened requirements on margin financing, triggering fears of further measures by regulators to reduce leverage in the red-hot market.
The CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 6.7 per cent, to 4,834.01, while the Shanghai Composite Index lost 6.5 per cent, to 4,620.27 points.
Turnover in Shanghai hit a record 1.2 trillion yuan (S$261 billion).
On Thursday, at least three Chinese brokerages, including Guosen Securities Co, Southwest Securities Co and Changjiang Securities Co said they would tighten margin requirements, following similar moves earlier in the week by Haitong Securities and GF Securities.
Separately, the Shanghai Securities News reported on its website that regulators have recently urged banks to submit data regarding money flows into the stock market, fuelling fears that the government could take additional steps to cool the market.
The market fell across the board.
REUTERS
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